The Pensions Regulator

Changes to regulator's powers

The Pensions Regulator welcomes today's announcement from the Department for Work and Pensions proposing changes to the regulator's anti-avoidance powers to help protect pension scheme members.

Like DWP, the regulator has been monitoring developments in the market – particularly those which help employers manage their liabilities more effectively. While innovation is to be encouraged, there have been some business models which have caused concern and have highlighted the need to update the regulator's powers.

Pensions Regulator chief executive Tony Hobman said: "We welcome the package of changes to legislation proposed by DWP, which will enable us to better protect members where their benefits are at risk. I believe our record to date provides comfort that we will continue to act in a risk-based way, using our powers as a last resort.”

The regulator wishes to reassure applicants for clearance that the DWP proposals do not change our established clearance process, which already focuses on potential detrimental effect on the security of members' benefits. We will continue to operate this process in a pragmatic, proportionate and responsive manner. Clearance is appropriate for 'type A events', which are described in our Clearance Guidance.

1. Visit the DWP's website for information on proposed changes to legislation.
2. 'Clearance' is the term used to describe the voluntary process of obtaining a clearance statement from the Pensions Regulator. A clearance statement gives assurance that, based on the information provided, the regulator will not use its powers to issue, to the applicants for clearance, either contribution notices or financial support directions in relation to a defined benefit occupational pension scheme and a particular event. Events include transactions, agreements, decisions, other acts and failures to act.
3. These powers include a 'contribution notice' requiring payment of a specified sum into a defined benefit scheme, or a financial support direction requiring financial support to be put in place for the scheme.
4. The clearance guidance and contact details for clearance enquiries can be found on the regulator's website.