Clause 44 - Duty to notify the Regulator of certain events
Pensions Bill
3:15 pm
Mr Malcolm Wicks (Minister for pensions, Department for Work and Pensions; Croydon North, Labour)
Clause 44 provides for a new statutory obligation on trustees and managers of
occupational pension schemes to report to the regulator in writing any prescribed event in relation to the scheme. Those events must be reported as soon as reasonably practicable. Along with the regulator's power to collect information relevant to the functions of the PPF board, the clause provides the backbone of the early warning system for the PPF.
We are working with the Pension Benefit Guaranty Corporation of the United States of America and the pensions industry in the United Kingdom to determine precisely what the notifiable events should be. The events will be specified in regulation and will include, for example, corporate restructuring affecting an occupational pension scheme or a significant payment becoming due to an individual scheme member in certain circumstances.
The regulator's power to collect such information serves two purposes. First, it may alert the regulator to potential or actual problems, and enable it to step in as early as possible to put things right. In doing so, the regulator may be able to prevent scheme members from losing out financially. It may also prevent a scheme falling into the jurisdiction of the PPF when it would otherwise have done so, which, in turn, will protect the members of all pension schemes that are liable to pay PPF levies.
Secondly, the regulator will be able to gather and disclose to the PPF any information that is relevant to the fund's functions. That will enable the PPF board to fulfil those functions. For example, the information that the regulator collects will be used by the board when setting and calculating the levies. It also means that, where the PPF becomes involved with the scheme, it will be able to act quickly if necessary to protect scheme members and prevent the scheme funding level from deteriorating further.