TPR consultation on draft DB funding code of practice and regulatory approach


The Pensions Regulator (“TPR”) has issued a consultation on a new draft DB funding code (“the Code”), and on a new twin track regulatory approach to assessing valuations. The consultation follows the DWP’s consultation on draft funding and investment regulations (“the Regulations”) carried out in 2022 (“the DWP’s consultation”), to which we also responded.

Our response to TPR’s first consultation on a revised Code is available here.

In this response

General Comments

We welcome the opportunity to respond to this consultation and set out some general overarching comments below. Given the actuarial nature of significant portions of the Code and Fast Track consultations, we have not sought to answer every question in the consultation documents. Instead, we have limited our responses to selected questions reflecting those areas which are pertinent to our practice area, or which we believe could give rise to difficulties in practice for our clients.

We have the following general comments about the draft Code and the proposed Fast Track approach:

Interaction with the draft Regulations

  • We recognise that the draft Code is based on the draft Regulations in the form consulted on by the DWP, which generated a lot of industry interest, and that changes made to the final Regulations will need to be reflected in the final Code. The Code is a roadmap which will be widely used by clients and advisers alike, so it will be vital to ensure that there are no gaps between them, as the regulations will be ultimately overriding. No doubt TPR will be aware of striking an appropriate balance between meeting the proposed timetable for the Regulations and Code coming into force (1 October 2023 at the earliest) and ensuring both achieve their intended aims. We would welcome a further opportunity to engage with TPR in relation to any changes to the draft Code.
  • Our response to the DWP’s consultation included a comment that the draft Regulations attempt to delegate a number of issues to be determined by the draft Code, such as specifying “the duration of liabilities” for the purposes of defining “significant maturity” in draft Regulation 4(1)(b). As explained in paragraph 6 of the draft Code, codes of practice are not statements of the law although, where relevant, they must be taken into account by Courts and Tribunals in determining whether legal requirements have been met. Paragraph 6 of the draft Code goes on to address the delegation in the draft Regulations: “legislation has delegated various matters” to the Code “which may (indirectly) be relevant to determining whether legal requirements have been met”. There is no clear legislative authority for the draft Regulations to do this, and it would be helpful to clarify the draft Regulations and the draft Code to remove any suggestion that there is any delegation to TPR to make the law in this way.

Scheme-specific approach and open schemes

  • In our response to the DWP’s consultation, we raised concerns that the draft Regulations appear to conflict with a scheme-specific funding approach, despite assurances from the Government during the passage of the Pension Schemes Act 2021 (“the PSA 2021”) through Parliament that the scheme funding regime “will continue to apply flexibly to take account of individual scheme circumstances.”
  • We welcome the various references in the draft Code to a proportionate, scheme-specific approach, particularly in relation to open schemes. For example, paragraphs 217 and 218 of the draft Code give helpful reassurance that investment risk could be possible over a longer period of time for open schemes. We also welcome the references to making “reasonable assumptions for the period of future accrual and/or the level of new entrants” in setting the technical provisions (“TPs”) for open schemes (paragraph 274), and the acknowledgment that it may be possible to use surplus in open schemes to fund future accrual (paragraph 283).
  • However, there is perhaps an inference in paragraphs 277 to 283 that trustees have more influence over the timing of a scheme closing to accrual than is typically the case under scheme rules. For example, within the context of setting TPs, paragraph 277 sets out the expectation that trustees “robustly consider the extent to which it is reasonable to make allowance for this continued accrual and new entrants when projecting the development of the scheme’s duration”. Paragraph 279 goes on to state that trustees “should consider to what extent it is reasonable to assume that the DB pension will continue to be offered”. It could help clarify TPR’s expectations if the Code expressly acknowledges that decisions to close schemes to new entrants and future accrual are normally subject to the scheme rules and will often not be within trustees’ control, although trustees should make reasonable assumptions when considering the time period for future accrual. We expect responses from open schemes, and responses covering actuarial aspects of the consultation, will comment on this in further detail.
  • The term “open schemes” is not defined in the draft Code. While we recognise the need for this term to apply flexibly to schemes with different characteristics, it could be helpful to “lay” readers if the Code specified in general terms what “open schemes” are, ie schemes where benefits continue to build up, some of which will also be open to new members.
  • Whilst the draft Code acknowledging the specific circumstances of open schemes may provide trustees of such schemes with some comfort, we remain concerned that the draft Regulations themselves do not cater for open schemes and that this is a potential area of inconsistency between the two. We hope that the drafting of the Regulations will be clarified.

Employer’s role

  • In our response to the DWP’s consultation, we commented on the importance of the new funding and investment requirements not inadvertently cutting across or changing the balance of powers between trustees and employers in relation to investment matters. We also suggested revising the draft Regulations to clarify that they do not seek to make trustees’ investment decisions subject to employer agreement, and to set out the precise scope and extent of the employer’s involvement in the funding and investment strategy (“the F&I Strategy”).
  • Although we hope this is an area where the draft Regulations will be updated, we welcome the references in the draft Code to the trustees having responsibility for taking decisions on their scheme’s funding position (eg in the first sentence of paragraph 373), and the comment that trustees “are not required to invest in accordance with the low dependency asset allocation determined as part of” the F&I Strategy (at paragraph 56). However, in our view, the draft Code could go further in making the employer’s role clearer, as well as the balance of powers in relation to the F&I Strategy, journey plan, and investment strategy. This includes clarifying the interplay with the Statement of Investment Principles, the legislation in respect of which remains unchanged, and will ultimately override the investment aspects of the F&I Strategy. A separate section addressing this might even be helpful.
  • For example, Appendix 1 could be expanded to specify the funding documents which are normally subject to employer agreement under the legislation, those which are subject to a requirement to consult the employer, and the investment decisions which trustees must make. As currently drafted, the statements at paragraphs 373 to 374 that “trustees are required to seek advice or agreement with other key entities, including the sponsoring employer and scheme actuary” and trustees “must normally reach agreement with the sponsoring employer on the contents of the funding documents before finalising the funding approach and submitting documents to us” could be misleading.
  • It would also be helpful for the Code to give more practical guidance for trustees on agreeing the F&I Strategy with employers, and consulting with employers on Part 2 of the statement of strategy (“the Statement”). For example, paragraph 20 could be expanded to cover TPR’s expectations in the event of trustees and employers failing to agree the F&I Strategy. Practical guidance would be particularly useful in relation to multi-employer schemes, where relatively complex changes may be required to existing scheme funding processes.

Relationship between the F&I Strategy, journey plan, and investment decisions

  • The changes to the funding regime will superimpose a new layer of requirements, funding documents and a new funding target on top of the existing regime. It would be helpful to have more explanation of how the regime fits together as a whole, and particularly how day-to-day investment decisions sit within the wider funding framework. For example, how “the low dependency asset allocation” fits with the existing framework is dealt with at a relatively high level in the draft Code (for example at paragraph 56).
  • In some places, the draft Code appears to go further than the draft Regulations in relation to the journey plan (ie the transition from the current investment strategy to a low dependency asset allocation). In our view, where the Code is describing a legal requirement (ie using the term “must”, as explained in paragraph 11), the language should closely reflect that of the relevant legislation. We question whether the use of the term “must” in paragraphs 32 and 37 to 40 is entirely consistent with the legislation, especially as regards the timing of the need to switch to a low dependency asset allocation.
  • For example, at paragraph 39, the draft Code states that trustees must ensure that the transition is “dependent on the strength of the employer covenant, where more risk can be taken if the covenant is strong” and, subject to the strength of the employer covenant, “dependent on the maturity of the scheme”. In contrast, under paragraph 4 of Schedule 1 to the draft Regulations, this is described as a “principle” which trustees must take into account when determining or revising a scheme’s funding or investment strategy. The draft Code appears to diverge from the draft Regulations in places such as this, although we acknowledge that, as currently drafted, the draft Regulations frame the “principles” in Schedule 1 as akin to minimum funding and investment requirements.


  • While we remain concerned that the draft Regulations are overly rigid in relation to covenant assessments, it is encouraging that the draft Code emphasises that they should be “proportionate to the specific circumstances of the scheme and the employer” (paragraph 122), in line with TPR’s existing covenant guidance (which we note is being updated for consultation in the coming months). Since covenant advice must consider the circumstances of individual schemes and employers, a “one-size-fits-all” approach could result in misleading assessments and be open to abuse.
  • In some cases, trustees’ covenant assessments may be limited by the availability of information. Paragraph 130 of the draft Code refers to trustees taking a lack of appropriate information into account when setting their F&I Strategy. However, since employer agreement is normally required, trustees may also be restricted in their ability to properly reflect the limited covenant assessment in the F&I Strategy.
  • It would be helpful for the Code to make a stronger link here between the trustees’ covenant assessment, and the requirement for employers to provide trustees and/or their professional advisers with information reasonably required to perform their respective duties (described in paragraph 377 of the draft Code). This applies equally to the trustees’ assessment of reasonable affordability (eg paragraphs 319 to 320).

Definition of significant maturity

  • As per our comments above under “Interaction with the draft Regulations”, and our response to the DWP’s consultation, there is no clear legislative authority to delegate what amounts to “significant maturity” and when a scheme reaches “the duration of liabilities” to the draft Code. In our response to the DWP’s consultation, we identified this as an area where the draft Regulations should be reworked. We suggested defining the point of significant maturity by reference to a reasonable period, giving TPR power to set out its expectations of what this means but with sufficient leeway for a scheme-specific approach where appropriate.
  • In relation to TPR’s expectations, while we appreciate the Code must reflect the Regulations, we question whether specifying a one-size-fits-all approach when it comes to the meaning of “duration of liabilities” (ie 12 years) offers sufficient flexibility or is in keeping with the principle of scheme-specific funding. A rigid approach might heighten the risk of future funding disputes, when the parties are simply pursuing a scheme-specific approach in line with the primary legislation.
  • The consultation document outlines possible alternative ways of defining significant maturity, and no doubt this is an area where the draft Regulations and the draft Code may change. However, if the Code does ultimately define the duration of liabilities, it would be helpful to understand how TPR envisages reviewing/revising that duration in response to industry practice or market conditions.
  • Reflecting the draft Regulations, paragraph 117 of the draft Code explains that the relevant date set by the trustees cannot be later than the end of the scheme year in which the scheme reaches significant maturity. The Code could provide more detail about the factors trustees should take into account when setting the relevant date and, in particular, the circumstances in which TPR expects it may be reasonable for the relevant date to be earlier than the end of the scheme year in which the scheme reaches significant maturity.

Drafting comments

  • The draft Code is, in our view, more technical and possibly less accessible to the “lay” reader, or smaller schemes which are less well-resourced, than the current DB Funding Code which it will replace. It would be helpful to have a glossary summarising the meaning of certain technical terms and abbreviations which are not otherwise defined, eg “LDIA”, “FIS”, “open schemes”, “average maturity”, “scheme outgo” (which is jargon), and “VaR”.
  • It would also be helpful to have statutory references for each of the statements in the draft Code which reflect legal requirements. While footnotes are used to provide references in places, this is not consistent throughout.
  • As mentioned above, use of the term “must” to reflect a legal requirement should ideally closely reflect the language of the relevant legislation so that legal obligations are clear. This applies throughout the draft Code.
  • Conversely, the draft Code appears to use “should” where “must” seems appropriate. For example, we would question whether the term “must” is required in paragraph 112 to reflect draft Regulations 4(2) and 4(3).
  • As minor drafting points:
    • we believe paragraph 99 should refer to the table in Appendix 4, rather than Appendix 3
    • at paragraph 162, we suggest switching the reference to “man” to the gender neutral “person”
    • at paragraph 309 “schemes” should be “scheme’s”
    • in the first sentence of paragraph 346 “a nd” should be “and”
    • the phrase in brackets in paragraph 361 should read “since the assets they own would be desirable to the insurer”.

Responses to specific questions in the Code consultation

Code chapter 2 – An outline of the funding regime

Question 1 (Code paragraphs 15 to 57): Are there any areas of the summary you disagree with or would like more/less detail? If yes, what areas and why?

Please see our general comments above in relation to the use of “must” in the Code to indicate a legal requirement, and footnotes to reference the relevant legislation.

In addition, at paragraph 17 of the draft Code, it would be clearer if the explanation of the required steps more closely tracked the Pensions Act 2004 (as amended). That is, by setting out that the requirements are to determine an F&I Strategy for ensuring that pensions and other benefits under the scheme can be provided over the long term (s.221A of the Pensions Act 2004), and to record the F&I Strategy, and further supplementary matters, including the steps to successfully implement the F&I Strategy, in the Statement (s.221B of the Pensions Act 2004).

Code chapter 3 – Low dependency investment allocation

Question 2 (Code paragraph 62): Do you agree with the principles for defining a matching asset that i) the income and capital payments are stable and predictable; and ii) they provide either fixed cash flows or cash flows linked to inflationary indices? If not, why not and what do you think is a more appropriate definition?

We wonder whether the list of asset classes needs expanding, eg to include buy-in contracts. In addition, paragraph 64 of the draft Code reads as though TPR’s expectation is that investment grade bonds should be the main asset class. Is this correct? If so, it raises concerns regarding the scheme-specific nature of the overriding DB funding regime and potential herding of investment risk.

For the sake of completeness, in our response to the DWP’s consultation, we queried whether transitional arrangements could be introduced for schemes which are already at or near significant maturity which may otherwise have to make abrupt adjustments to their investment strategy to comply with the new requirements.

Question 7 (Code paragraphs 87 to 90): Should we, and how would we, make this approach to broad cash flow matching more proportionate to different scheme circumstances (eg large vs small)?

In our view, as currently drafted, the draft Regulations provide limited flexibility to allow a scheme-specific approach to the low dependency asset allocation, and the draft Code reflects this. However, the Code could emphasise that the Regulations are not intended to restrict trustees’ existing investment powers, given that they are already subject to investment duties as a matter of trust law and existing pensions law requirements under sections 33 to 36 of the Pensions Act 1995. This would be particularly helpful at paragraph 90 which discusses trustee investment decisions.

As mentioned in our general comments above, it would also be helpful for the draft Code to define the term “average maturity” (used at paragraph 89), since this term could be open to interpretation.

Code chapter 4 – Low dependency funding basis

“Low dependency” on an employer involves trustees not expecting to need further employer contributions. Paragraph 92 of the draft code refers to trustees assessing this “under most reasonably foreseeable scenarios”. That phrase is not used in the legislation and the draft Code does not explain its meaning. Whilst this may be intentional, so as to allow scheme specific circumstances to shape its meaning, some illustrative examples would be useful.

Question 15 : Do you agree with the guidance and principles set out in Appendix 3 and 4? Are there any specific assumptions here you would prefer a different approach? If so, which ones, why and how would you prefer we approached it?

Appendix 4 (allowance for expenses in low dependency liabilities) does not appear to take into account that employer commitments to pay expenses may sit outside scheme rules.

Code chapter 5 – Relevant date and significant maturity

Question 16 (Code paragraph 113): Do you agree that a simplified approach to calculating duration for small schemes is appropriate?

Clearly, a careful balance needs to be struck between setting expectations and taking a proportionate, scheme-specific approach, and scheme size will normally be an important factor in determining what is proportionate. However, we are concerned that paragraph 113 of the draft Code suggests a simplified calculation for smaller schemes without defining what is meant by “smaller schemes”. In our view, this leaves TPR’s expectations unclear. If the intention is to allow schemes to use a simplified calculation where proportionate, the Code could explain the factors that TPR expects trustees to take into account.

Code chapter 6 – Assessing the strength of the employer covenant

Question 18 (Code paragraph 132): Do you agree with the definitions for visibility, reliability, and longevity? If not, what would you suggest as an alternative?

While these principles seem reasonable, we expect that, in practice, it may often be difficult to assess and identify the length of periods of “visibility”, “reliability” and “longevity”, particularly where employer cash flows fluctuate significantly. This could lead to increased use of caveats and/or a higher cost involved in carrying out such assessments. Please also see our general comments above in relation to covenant.

Question 21 (Code paragraphs 148 to 151): Do you agree with the principles we have set out for contingent assets, ie that i) it is legally enforceable and ii) it will be sufficient to provide that level of support? If not, what would you suggest as an alternative?

These principles seem sensible and are broadly in keeping with the conditions for recognising contingent assets by the PPF. It might be helpful for the Code to confirm that other support arrangements could also be valuable to the scheme, even if they are not formally taken into account as contingent assets for covenant purposes. There is a risk otherwise of informal support arrangements being withdrawn.

Question 23 (Code paragraphs 156 to 159): Do you agree with the approach we have set out for valuing guarantees? If not, what would you suggest as an alternative?

We query whether different treatment of “look through” guarantees is necessary or justified. “Look through guarantee” is not clearly defined, but, as currently drafted, paragraphs 156 to 158 could be read as suggesting that other forms of guarantees are less valuable. This could act as a disincentive to companies in providing other forms of support. We suggest that the factors listed in draft paragraph 158 should be taken into account in assessing any type of guarantee.

Question 24 (Code paragraphs 160 to 162): Do you agree with the approach we have set out for multi-employer schemes? If not, what would you suggest as an alternative?

Our response to the DWP’s consultation noted a concern that the covenant requirements in the draft Regulations may not be appropriate for multi-employer schemes, as they appear to require trustees to carry out the same covenant assessment for each sponsoring employer. We welcome the more proportionate approach set out in the draft Code, but we hope that the underlying legislation is revised to better support that proportionate approach.

Code chapter 7 – Journey planning

Question 32 (Chapter 7 generally): Do you agree with our approach of not being prescriptive regarding the journey plan shape?

In relation to the consultation questions on Chapter 7 of the draft Code, please see our general comments above on the interaction between the F&I Strategy, journey plan and investment decisions. We agree that the Code would be going beyond the boundaries of the legislation if it attempted to prescribe the journey plan shape, or to restrict or mandate investments during the journey plan.

Section 229(1)(za) of the Pensions Act 2004 will require trustees to seek employer agreement to “the scheme’s funding and investment strategy, as set out in the scheme’s statement of strategy”. Trustees are also required to consult the employer on Part 2 of that statement. Given the slightly odd wording of the legislation, it would be helpful if paragraph 175, and the draft Code generally, could pin down more precisely the extent of an employer’s involvement. Please also see our general comments on the employer’s role above.

Code chapter 8 – Statement of strategy

Question 34 (Chapter 8 generally): Do you agree with our explanation of the Statement and are there areas it would be helpful for us to expand on in this section?

As highlighted in our general comments above, it would be helpful for the Code to provide more detail about the employer’s role in agreeing the F&I Strategy and being consulted in relation to the Statement.

In our view, trustees would find a comprehensive list of the matters that must be included in Part 2 of the Statement under the Regulations helpful (see paragraphs 240 to 248), alongside any relevant expectations that TPR has about how this is presented.

Code chapter 9 – Technical provisions

Question 36 (Code paragraphs 274 to 280): Do you agree that open schemes could make an allowance for future accrual – thereby funding at a lower level – without undermining the principle that security should be consistent with that of a closed scheme?

Yes, we agree that open schemes should be able to make reasonable assumptions about future accrual in relation to their funding and investment. In our view, this is consistent with a proportionate and scheme-specific regulatory approach, and with the assurances provided by the Government during the passage of the PSA 2021 through Parliament.

Question 38 (Code paragraphs 281 to 283): Do you agree with our principle-based approach to future service costs? If not, why not and what do you suggest as an alternative?

In general, these seem sensible. In particular, we welcome the recognition in paragraph 283 of the draft Code that it may be possible to use surplus to fund future accrual in the scheme in certain circumstances. However, we would reiterate our general concern, expressed above, that paragraphs 277 to 283 perhaps infer that trustees have more influence over the timing of a scheme closing to accrual than is typically the case under scheme rules.

Code chapter 10 – Recovery plans

Question 40 (Code paragraphs 286 to 287; Chapter 10 generally): Do you agree with the description in the draft Code of the interaction between the principle that funding deficits must be recovered as soon as the employer can reasonably afford and the matters that must be taken into account in regulation 8(2) of the Occupational Pension Schemes (Scheme Funding) Regulations 2005 (“the Investment Regulations 2005”)?

When exercising its scheme funding functions, TPR has a statutory objective to minimise any adverse impact on the sustainable growth of employers. Our response to the DWP’s consultation noted that this does not sit comfortably with the proposed requirement under draft Regulation 20(8) that trustees must follow the principle that “funding deficits must be recovered as soon as the employer can reasonably afford”. We assume that TPR are aware of this potential tension and are considering how best to address it in practice.

The approach to “reasonable alternative uses” is relatively prescriptive, and we wonder whether this section of the Code may be more suited to a less prescriptive approach, recognising that there will often be practical limits to the covenant assessment. For example, we expect it may be difficult for employers to evidence, and for trustees to assess, return of value, or the likely timeframe over which sustainable growth may materialise compared to the scheme’s liability profile (paragraph 309 of the draft Code).

We were unclear from paragraph 303 what is meant by “covenant leakage”, as there may be any number of perfectly reasonable situations when available cash leaves the employer and no return of value is due or expected. If TPR retains this approach to defining reasonable alternative uses, could the Code provide more examples than are currently given in paragraph 303? We note that the covenant guidance is being revised and may include further examples.

Question 45 (Code paragraph 295): Should we set out more specifics around what we would expect by way of security to protect against the additional risks?

We agree with the principle that additional risk should be permitted where it is appropriately supported by the employer covenant. Prescribing a particular type of support would, in our view, contradict the principles of a scheme-specific funding regime.

Code chapter 11 – Investment and risk management considerations

Question 47 (Code paragraphs 324 to 326): Do you agree with the examples we have given for when trustees investment strategies may not mirror their F&I Strategy? Are there other examples we should consider?

Please note our general comments above on the interaction between the F&I Strategy, journey plan and investment decisions, and our responses to Questions 7 (trustees’ investment obligations) and 32 (journey plan) above.

TPR’s expectations here do not sit comfortably with trustees’ existing investment obligations under trust law and the Investment Regulations 2005, nor with a scheme-specific funding approach. It may not always be appropriate for trustees’ investment decisions to be consistent with the F&I Strategy. This messaging needs to be clarified throughout the draft Code. Also, whilst paragraph 325 notes some circumstances in which investment decisions may not necessarily “mirror” the F&I Strategy, it should be made clear that these are just examples (as they currently read as akin to limited exceptions).

Question 53 (“Systemic risk considerations” section of the consultation document): Do you agree with the above considerations? If not, please explain.

Whilst this is not a legal question, our hope, as detailed in our general comments above and throughout this consultation response, is that the principles of a scheme-specific funding regime will be reflected to the greatest extent possible in the final Regulations and Code. We believe any shift away from scheme-specific funding could increase the systemic risks inherent in a prescriptive, granular approach to scheme investments.

Responses to specific questions in the Fast Track consultation

Question 1 (sections 1, 2 and 3): Do you agree with how we have positioned Fast Track relative to the Code?

The reasons given in section 5 of the consultation document for setting out the Fast Track parameters in guidance rather than in the Code appear sensible, including providing greater flexibility to revise and update the set parameters. TPR will be well aware of the importance of consulting the industry on any changes, and ensuring that sufficient notice is given of any changes, given the potential impact on the way trustees and employers approach valuations.

Question 3 (sections 2 and 3): Do you agree that Fast Track should come with a lower level of burden in terms of the explanations required as part of the trustees’ valuation submission?

The explanations required should be proportionate to the circumstances of the scheme, whether the scheme falls under the Fast Track or Bespoke approach. Trustees submitting a Bespoke valuation should not automatically have to provide a greater level of evidence and explanation unless this is proportionate to the greater level and complexity of risk taken. This should also help TPR to direct its valuable resources towards the schemes where its most warranted.

Question 5: Could we make Fast Track more proportionate for schemes in differing circumstances?

While this is primarily an actuarial question, from a legal perspective our view is that Fast Track should be designed to accommodate different types of schemes. While the Bespoke route would be available to ensure a scheme-specific approach, the Fast Track route should also ideally capture the essence of a scheme-specific funding regime.

Question 23 (section 10): Do you agree with our definition of smaller schemes for this purpose?

We agree with the principle of acknowledging the different circumstances faced by smaller schemes and ensuring that the Fast Track parameters apply proportionately to such schemes.

The definition of smaller scheme, ie as having less than 100 members, is consistent with other carve-outs in pensions legislation (eg exemptions from the requirement to obtain annual actuarial reports).

Question 25 (Appendix 1): Do you agree with our approach for new entrants? If no, explain why and what would you suggest as an alternative?

Our only comment here is that, wherever these parameters are ultimately set, we would not expect them to exclude a disproportionate number of open schemes from Fast Track. Also, the influx of new entrants may be quite variable and a three-year average might not be representative.

Question 27 (section 14): Which of the options for reviewing our parameters do you prefer?

Please see our response to Question 1.

Question 28 (section 14): Do you think a different approach to reviewing our parameters is preferred?

Please see our response to Question 1.

Question 29 (section 15 and Appendix 5): What further analysis do you think would be helpful to illustrate the potential impacts of any final regulations and code?

We assume that TPR will monitor the impact of Fast Track in practice. In particular, we assume TPR will be keen to guard against schemes “levelling down”, due to the influence Fast Track may have on trustees’ negotiating position when seeking a more robust valuation than the Fast Track parameters, and possible investment herding.