The Pensions Regulator has fined pension schemes more than £30,000 in a bid to ensure savers get value.
This comes after TPR launched an initiative to check that savers in DC schemes were benefiting from rules requiring trustees to assess whether they deliver value through a detailed value for members assessment.
The regulator’s compliance and enforcement bulletin, revealed it had used its powers 10 times in relation to the assessments between January and June 2024 and issued seven penalties, totalling £19,250, while also issuing three improvements notices.
TPR has named the schemes fined in relation to the detailed value for members assessment breaches on the penalty notices page of its website, with more schemes expected to be named as further penalties are issued or paid.
Mel Charles, interim executive director of regulatory compliance at TPR, said: “These penalties show our determination to ensure DC schemes deliver value for savers.
“Those that can’t meet our expectations should consider whether a transfer to a better-value scheme and winding up is in members’ best interests.”
Combined with penalties issued between November 2023 and January 2024, when TPR carried out a pilot exercise, total penalties for these breaches have reached £33,750.
Trustees of schemes failing to deliver value must have a plan to improve or transfer members to a better-value scheme, TPR warned.
The bulletin also showed TPR fined two pension schemes for failures relating to annual climate change reports.
GKN Group Pension Scheme and The Prudential Staff Pension Scheme were fined £8,000 and £5,000 respectively.
Charles added: “The vast majority of schemes are complying with their climate reporting requirements, but we will continue to enforce where we identify failures.
“We are also increasing our focus on investment governance and trustees should expect to be challenged on whether their climate reporting disclosures are the product of strategic decision making aimed at protecting savers from the financial risks of climate change, both now and in the future.”
TPR warned that schemes in scope of the Taskforce on Climate-related Financial Disclosures recommendations, must publish their report by a set deadline on a publicly available website so savers can be assured trustees are making decisions which take into account climate risks and opportunities.
Automatic enrolment powers
According to TPR its automatic enrolment powers have remained broadly consistent since the previous period, which covered July to December 2023.
It issued 30,688 compliance notices compared to 29,489 in the previous period as well as, 18,589 unpaid contribution notices compared to 17,451.
It also issued 20,677 fixed penalty notices and 7,682 escalating penalty notices.
Catherine Nicholson, interim joint director of automatic enrolment at TPR, said: “Millions of savers will depend on their workplace pension gained through AE for their retirement needs. To ensure they get the pension they are due, we first and foremost support employers to meet their AE duties, directly communicating with around 500,000 each year.
“However, for the minority who fail, we will, where necessary, use our powers to protect savers. Through the enforcement activity demonstrated in this bulletin and the support we provide, this period saw 97 per cent of employers pay their workers’ contributions on time.”
