The Pensions Regulator (TPR) is calling on occupational pension schemes, their administrators, providers, and the wider industry, to respond to its newly published consultation on dashboards compliance and enforcement.
The compliance and enforcement policy sets out TPR's expectations on how schemes should comply with new regulations, and its approach to regulating dashboard obligations. TPR is keen to hear from schemes of all sizes, their administrators and integrated service providers to ensure the new policy is understood by, and meets the needs of, the industry.
David Fairs, TPR's Executive Director of Regulatory Policy, Advice and Analysis, said: "We are aware that the months ahead will be challenging for the pensions industry as they prepare to meet their dashboards duties. We will be supporting them by writing to all schemes at least 12 months ahead of their connection deadline to help them understand what they need to do by when, in accordance with our published guidance.
"We will be pragmatic in our approach to regulating dashboards compliance and will not be looking to simply issue fines. However, it is not acceptable for schemes and their administrators to do nothing, and we'll take a dim view of wilful or reckless non-compliance.
"We have been talking to industry for several years about their obligations and schemes should already be looking at their data management, internal governance and how they will meet their obligations. Overall, the long-term focus when developing our compliance and enforcement policy has been how to best support the future experience for savers when using dashboards. We want to empower savers to feel confident accessing a dashboard and taking control of their long-term savings."
While TPR already regulates trustees and workplace pensions, a key part of complying with dashboard obligations will rest with third parties, such as administrators, employers and integrated service providers.
New legislation has been introduced enabling TPR to issue third parties with compliance notices. If they do not comply, they could be fined up to £50,000 (and individuals up to £5,000) for each breach.
This is alongside other new powers to fine trustees and managers in the case of non-compliance with dashboard regulations. They include an option to issue penalties of up to £5,000 to individuals and up to £50,000 in other cases for any instance of a single compliance breach.
The consultation document includes several scenarios illustrating how TPR’s approach might translate in practice for a range of breaches. Stakeholders have previously said these would be useful, and so TPR is particularly keen for feedback on the scenarios.
The consultation will close on Friday 24 February 2023.
Notes for editors
- TPR expects to publish its final policy in spring 2023, ahead of the first schemes' dashboard deadlines in August 2023.
- Penalties are not mandatory, and TPR will use its discretion. They are not intended to be punitive and are always used with a view to remedying a breach.
- Pension schemes with more than 100 active or deferred members will connect to pensions dashboards through a phased approach according to size and type of pension scheme.
- Each scheme will belong to a category which will have a specific deadline set out in legislation.
- Connecting to the dashboards means schemes must have an appropriate interface in place to receive information requests from savers – and accurate data to provide them with the information they require about their pensions.
- The Pensions Regulator is the regulator of work-based pension schemes in the UK. Its statutory objectives are: to protect members’ benefits; to reduce the risk of calls on the Pension Protection Fund (PPF); to promote, and to improve understanding of, the good administration of work-based pension schemes; to maximise employer compliance with automatic enrolment duties; and to minimise any adverse impact on the sustainable growth of an employer (in relation to the exercise of the regulator’s functions under Part 3 of the Pensions Act 2004 only).
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