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The Actuary The magazine of the Institute & Faculty of Actuaries

TPR publishes coronavirus guidance

The Pensions Regulator (TPR) has published guidance to help UK pension trustees, employers and administrators deal with the financial and regulatory risks posed by coronavirus.

Coronavirus threatens pensions ©iStock
Coronavirus threatens pensions ©iStock

The guide explains how benefits must continue to be paid to members of defined benefit (DB) pension schemes, and the risk of scams minimised.

It also highlights how employers need to continue contributing to schemes, and recommends that savers be provided with support to make good financial decisions.

TPR said that administrative breaches of the law may occur as COVID-19 unleashes “unprecedented” challenges, and that it will take a “proportionate and fair” response.

“We are closely monitoring the COVID-19 situation, and working collaboratively with government, regulators and other bodies to assess the most immediate risks to pension schemes,” the regulator said in a statement.

The guide urges trustees to assess whether their business continuity plan is still adequate, and to find out what contingency is in place to mitigate the impact of increases in work volumes or unavailable staff.

Trustees of DB schemes with a sponsoring employer at risk who has asked to reduce or suspend deficit repair contributions should read TPR's corporate distress page.

Administrators are advised to prioritise payments of benefits, retirement processing and bereavement services, as well as any administrative functions required to support these.

The guide also warns that scammers may target pension savers more aggressively as people look to transfer their pensions during these uncertain times.

“The guidance also notes the regulator is suspending its regulatory initiatives and postponing some of its activity,” said XPS Pensions head of pensions solutions Wayne Segers. “Notable is that it expects to extend the consultation period for new funding rules. 

“While an extension is understandable the good practice outlined in the code is very helpful for making decisions in such challenging times. I would encourage employers and trustees to reflect this in decision making.”

TPR's guide will be updated over the coming weeks as risks evolve.

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