North West Regional Group - Covenant challenges & pensions restructuring: A trustee perspective
PMI's North West regional group - Covenant challenges & pensions restructuring: A trustee perspective
TPR has been encouraging trustees to take formal, external covenant advice now for more than 10 years, however this should not just be a triennial valuation exercise. An ongoing monitoring of the financial position and prospects of a pension scheme’s employer are key.
Many trustee boards have used the uncertainties caused by the Covid-19 to request further and more regular financial information from their employer, whether easements on Deficit Repair Contributions were requested or not. This sharing of information should be continued and used to monitor and prepare for any reduction in covenant strength.
In the last few weeks we have seen Covid-19 restrictions increase, with businesses facing cliff edges in government support and an undetermined outcome for Brexit there is the expectation of a sharp rise in corporate restructurings. Where there’s a threat of insolvency for the employer, trustees need to ensure that they have plans to run the scheme on a stand alone basis.
Freefor members and non-members
1 hourof CPD
- PMI North West Regional Group members
- PMI members
Hear from the experts
Sarah is a professional trustee, who joined Dalriada in Autumn 2019 from PwC’s covenant advisory practice. She now acts as trustee on a range of trustee boards.
Sarah’s experience both as a trustee and adviser includes managing the scheme valuation process, integrated risk management and scheme governance. She is also able to bring to trustee boards a depth of commercial experience and employer covenant knowledge, assisting in developing wider scheme strategy aligned with corporate activity.
Her covenant, restructuring and insolvency background brings invaluable ‘hands on’ experience in stakeholder communication, critical in delivering successful outcomes in more challenging situations.