7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.
In this 7 Days
- TPR launches campaign on climate and ESG compliance
- PASA publishes whitepaper on “focusing on a saver-centric experience”
- PASA publishes guidance on data readiness for buy-in and buyout
- SPP publishes updated ESG guidance
On 22 February 2023, TPR launched a new campaign to ensure trustees are meeting their ESG and climate change reporting duties (see our ESG guides for details of the duties). The campaign includes a regulatory initiative in the spring “to check whether trustees are publishing important data on ESG”, with emails being sent to schemes making clear that TPR is analysing scheme return data to monitor compliance.
TPR will review a “cross-section” of SIPs and implementation statements (“ISs”) in the summer, and will share the outcome of the review with industry to highlight good practice. Initial analysis of data provided through the 2022 DC scheme return has shown that “a number of schemes” did not provide valid website addresses for their SIP and ISs. TPR also expects to issue a statement on annual climate change (or “TCFD”) reports for schemes with relevant assets of £1bn or more in the spring (see our Alert for details).
Enforcement action can be taken against trustees who fail to publish their SIP, IS, or TCFD report, as relevant, including a fine of up to £50,000 for corporate trustees.
PASA published a whitepaper on 22 February 2023 exploring best practice to support savers on their retirement journeys. The paper sets out the findings of interviews conducted with various parties, including administrators and professional trustees, and contains guidance on how the pensions industry can “leverage developments in other parts of financial services to deliver better outcomes for savers”, such as improving data quality and processes.
On 27 February 2023, PASA published guidance which aims to support trustees and administrators on ensuring data is ready for proceeding with an insurer transaction. This should help schemes obtain “more certain and preferential overall costs” in the buy-in and buyout market. The guidance sets out actions trustees can take which should result in “quick wins” for improving data quality, and ways trustees can demonstrate to insurers that their data is kept up to date and accurate. This includes preparing a benefit specification, which can flush out data issues which haven’t previously come to light during day to day administration processes.
The SPP has updated its ESG guidance for trustees, which is intended to give a “high-level overview of the subject”, setting out trustees’ legal obligations, and offering practical support. Aimed primarily at trustees of small to medium sized schemes, it includes suggested approaches for different investment structures, guidance on engaging with investment managers and advisers, and a three-step framework for compliance.