The National Association of Pension Funds (NAPF) commented on the draft Code of Practice for defined contribution (DC) trust-based pensions, which was published by The Pensions Regulator (TPR) today.
Darren Philp, NAPF Policy Director, said:
“Defined Contribution pensions are the future of retirement saving and it is vital that we get them right, so we welcome the Regulator’s efforts to improve them.
“But we are disappointed that the proposed code only applies to trust-based pensions and not contract-based schemes. This means that around three million people are saving into a type of pension that is overlooked by this effort.
“All types of pension need to meet high standards, and we need a joined-up regulatory approach. The FSA and Regulator need to work together much more effectively than they currently do.
“We are also concerned that enforcing the new code through voluntary reporting requirements means there is a risk that the Regulator focuses on the wrong schemes.
“The Regulator needs to avoid placing extra burdens on schemes that are already well-managed and focus on the schemes and providers that are struggling to deliver good outcomes for savers. Despite the good intentions, this strategy risks doing the opposite.”
Commenting on the TPR research on scale, Mr Philp said:
“This report confirms our views that large-scale pension schemes are better governed. We now need to ensure that we create a regulatory environment that helps foster the creation of large pension schemes. Their scale will help deliver better outcomes to savers by reducing pension charges and improving governance.”
Notes to editors:
1. The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,300 pension schemes with some 16 million members and assets of around £900 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.
Paul Platt, Head of Media and PR, NAPF, 020 7601 1717 or 07917 506 683, [email protected]
Christian Zarro, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]