The Pension Regulator’s (TPR) updated guidance has been met with some criticism from the industry, which is urging more action as the UK enters Covid-19 pandemic lockdown.
The regulator said its guidance - issued on 20 March - will continue to be updated in the coming weeks and aims to address areas of pressure within the pension system as market uncertainty increases.
Despite its calls for trustees of both defined benefit and defined contribution schemes, employers, and administrators to focus attention on key risks to pension savers, many say the guidelines do not go far enough in demonstrating robust examples of appropriate action to stem all business pressure points.
Sackers partner Georgina Jones said: "Key questions remain unanswered [and] we would encourage TPR to consider a regular communication, such as the government's, with a heads up as to when they can be expected."
Aries Insight director Ian Neale agreed TPR "should go further" in its support for trustees, employers, administrators, and members.
"So far we only have some response from TPR to demands from employers, for example to reduce deficit repair contributions. All parties are beleaguered and bewildered by the speed and turn of events at the moment, and like everyone else, need reassurance from the relevant authorities, in this case, TPR," he said.
"It would be helpful if TPR could announce a pause period during which all normal scheme activities dependent upon asset values, such as transfers and actuarial valuations, were suspended until the current extreme volatility settled down. Disclosure and reporting deadlines could be relaxed while everyone takes stock."
Despite calls for clearer communications, Altus Consulting head of retirement strategy Jon Dean agues TPR's updated guidance "is very clear".
"The regulator is effectively relying on trustees to make judgement calls on the priorities for their schemes, check the business continuity plan arrangements with administrators and investment managers, and place a focus on maintaining pension payments, retirement and bereavement processing," he said.
XPS Pensions head of pensions solutions Wayne Segers added: "The regulator expects employers to continue with contributions but recognises the challenges they face.
"Some employers face a threat to their existence due to the Coronavirus outbreak [and] a number are seeing a substantial impact on their revenues and workforce and a significant fall in cash flow.
"A short reduction or suspension in employer pension contributions can in some cases make the difference to an employer's survival."
Segers agreed trustees need more support from businesses which in turn needed clearer guidelines, however, with the clear message for the from TPR "to focus more than ever on members".
"We see most businesses planning for and measuring the impact of the current downturn on their business and this information should be shared with trustees to make them aware of the impact of scenarios and how being ready to reduce contributions can help in extreme outcomes," he said.
Segers asserted all trustees "should proactively engage with their employers" to understand how the current environment affects their business.
"The best way to ensure that a scheme can meet all pensions over time is to ensure that the employer is robust through the current crisis and can fund the scheme over the long term," he said.
A key concern for many is still on dealing with valuations, PwC pensions partner Paul Kitson said.
"The guidance doesn't address the approach trustees and sponsors should take for not yet completed 2019 valuations, and upcoming 2020 valuations [and] many trustees and sponsors will want certainty here and we expect to hear more from the regulator on this in due course," he said.
"Balancing supporting the sponsor against maintaining the current level of contributions will still be a challenging decision for trustees who have some difficult decisions ahead of them."
Jones said further guidance is also needed on whether employers will be able to reduce or suspend auto-enrolment payments but said TPR "struck the right note" with information so far.
She said: "Our key message to clients has been to prioritise, so it's heartening to hear TPR making the same noises."
In response, TPR spokesperson told Professional Pensions: "We acknowledge these are challenging times for employers and those who run pension schemes. Our initial guidance deals with the key issue that trustees, sponsors and administrators need to prioritise their activities based on their available resource. We consider paying benefits and investing contributions as key.
"We have taken steps to reduce our activities to lower the burden on schemes and have said that we will take a proportionate approach on compliance recognising that meeting all requirements might be challenging for some. We intend to issue further guidance on a regular basis prioritising our messages to deal with the most pressing concerns or issues we are having to deal with most frequently. In some areas, we are conducting further research and analysis to give a fuller and more considered response."
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