UK - Pension regulators should focus on major risks to pension schemes rather than smaller breaches that pose little risk to members.
This is the view of a National Audit Office study – OPRA: Tackling the Risks to Pension Scheme Members – which calculates that 60% of OPRA cases have concerned late payments of pension contributions. It believes that such delays have little impact on scheme members as the payment is often made before any action by OPRA is taken.
National Audit Office head Sir John Bourn said: “OPRA needs to move from handling a large number of small scale reports to focus more on identifying and mitigating the more serious risks faced by members of pension schemes.”
OPRA chairman Harriet Maunsell welcomed the report as “a thorough and well balanced independent study” which reinforced many of OPRA’s own recent conclusions.
However, Smith & Williamson head of pensions and financial planning Mike Fosberry thought the report was an indictment of the burden of legislation imposed on pension schemes.
He said: “If OPRA has been guilty of nit picking it needs to be brought to heel.”
The National Audit Office report has also recommended that OPRA becomes better informed about the risks facing pension scheme members and develop different communication and regulatory approaches for various types of scheme.
It has also called for more regulatory effort on providers and third-party administrators – a recommendation that has already been put into action with OPRA naming and shaming insurance giants Eagle Star and Jardine Lloyd Thompson.
OPRA faces almost certain reform as a result of a quinquennial review of its activities and from Simplification Report author Alan Pickering who believes OPRA becomes a source of advice for pension schemes rather than just a mere regulator.
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