For the Pensions Regulator (TPR), this has been no different. Our focus remains on protecting savers by ensuring pension schemes are well run. However, we do not operate in a bubble and to be an effective regulator it is necessary to take action and make balanced decisions in light of changing environments.
While the events of the last seven months are unprecedented, TPR’s clear, quick and tough approach is proving vital in helping us to respond to the challenges as they have unfolded.
In the early days of the lockdown in March, we took swift and decisive action to support employers and pension schemes through the crisis. In line with the government’s response, we recognised the enormous pressure employers found themselves under. The best way to protect savers in that sudden and wholly extraordinary period was to support their employers.
We recognised both employers and pension schemes needed the space to focus on their immediate risks and priorities.
In respect of employers, we did not want to make an extremely challenging and unforeseen situation worse for them. The decision to introduce measures to support employers balanced the need to recognise pressures on employers (and, therefore, not increase the risk of job losses) with the need to ensure employers meet their pension duties so staff receive the contributions they are due.
The successful roll out of automatic enrolment has changed the savings culture and our research shows most employers want to do the right thing for their staff. Automatic enrolment is the norm for employers and it is only necessary to use our powers in a minority of cases. We have seen those themes and behaviours have largely endured over recent months. Employers are continuing to meet their automatic enrolment and re-enrolment responsibilities on time. Compliance levels for new and existing employers remain steady with the vast majority of employers successfully assessing staff and putting those who opted out back into a pension.
Where we do encounter non-compliance, our experience tells us that where a warning notice is issued, this is enough to bring the majority of employers back on track. So, while we took a risk based approach to issuing some financial penalties, we have continued to issue compliance notices warning employers to take action to rectify breaches.
That said, we have remained clear throughout the pandemic that employers continue to have workplace pensions duties. While we will make pragmatic enforcement decisions in light of the pressure they are under, we have continued to vigorously pursue the small number of employers who commit serious or prolonged breaches.
Consistent with the government’s plans and support for businesses, we are returning to normal enforcement approaches so that savers continue to be protected and that employers fulfil their automatic enrolment duties on time and in full, including paying workplace pensions contributions for their staff.
This article was featured in Pensions Aspects magazine November/December edition.
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