The Pensions Regulator (TPR) is asking for views on its proposals to help trustees of DB schemes meet new requirements for submitting a statement of strategy.
The Pensions Schemes Act 2021 and associated regulations introduce new requirements for trustees of defined benefit (DB) schemes to set a long-term funding and investment strategy for their scheme. From 22 September this year, they will also be required to complete a statement of strategy alongside their actuarial valuation, that sets out this long-term funding strategy and their approach to managing associated risks. This should be a useful tool to support trustees in their long-term planning and risk management, and facilitate engagement between trustees, employers and TPR.
Following industry engagement from last summer, TPR has created statement of strategy templates to minimise the administrative burden on trustees and is now seeking feedback on its proposals. The consultation builds on TPR’s previous DB funding code consultations and runs for six weeks closing on Tuesday, 16 April.
TPR’s Interim Director of Regulatory Policy, Analysis and Advice, Lou Davey said: “Receiving statements of strategy will give us additional data to better understand journeys that schemes are on as they mature, improving our regulatory oversight. Our proposals are designed to make it as easy as possible for trustees to comply with new legislation, and ultimately to show how they are acting in the best interest of savers.
“We want a broad range of views to ensure our proposals are understood and accepted by trustees and advisers.
“In particular we want to know if people think we are being clear on what data we’re asking trustees to provide, whether this data is readily available, or what challenges there could be in sourcing it.”
Notes for editors
TPR’s revised DB funding code will set out the standards it expects trustees of DB schemes to meet to comply with new Funding and Investment Strategy (FIS) regulations.
The FIS regulations are expected to come into force in April 2024 and be applicable to actuarial valuations with effective dates from 22 September 2024 onwards.
The new statement of strategy that trustees will be required to prepare under the Pension Schemes Act 2021 and the FIS regulations is made up of two parts:
- Part 1, which records the funding and investment strategy
- Part 2, which records various supplementary matters (including how well the funding and investment strategy is being implemented, the main risks to the strategy and how they are being managed)
TPR is required to set the form of the statement of strategy and the detail of the information that trustees will need to submit, which may vary depending on the circumstances of the scheme.
For further information on TPR’s twin track regulatory approach (Fast Track and Bespoke), please see its consultation document published in December 2022. Please note that Fast Track parameters and pass rates are being updated to take account of responses to our consultation, changes to market conditions and more recent data.
TPR is the regulator of workplace trust-based pension schemes in the UK. Our statutory objectives are to:
- protect members’ benefits 
- reduce the risk of calls on the Pension Protection Fund
- promote, and to improve understanding of, the good administration of work-based pension schemes
- maximise employer compliance with automatic enrolment duties
- minimise any adverse impact on the sustainable growth of an employer (in relation to the exercise of the regulator’s functions under Part 3 of the Pensions Act 2004 only)
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