UK roundup: TPR, PADA-NEST
UK - The Pensions Regulator (TPR) has issued guidance on multi-employer scheme support, while the Personal Accounts Delivery Authority (PADA) has claimed it remains on track to deliver the National Employment Savings Trust (NEST) "on time and at low cost" ahead of the transition to the NEST Corporation next week.Understanding the role of employers in multi-employer schemes and what happens when an employer departs from one of these schemes is the subject of the latest guidance from TPR to help trustees assess the employer covenant.
The consultation on the guidance, which coincides with two new e-learning modules for trustees, has been released in response to requests from trustees for more help from TPR, as the regulator admitted the employer debt regime for multi-employer schemes is "a complex area".
Bill Galvin, acting chief executive at TPR, said: "The support of the employer standing behind the scheme is central in securing members' benefits.
"This is just as important in a multi-employer scheme.
"It is, of course, crucial trustees understand their duties when an employer departs the scheme."
However, he noted the draft guidance also reinforced the importance of ensuring the strength of the employer covenant was regularly reviewed and maintained throughout the scheme's life.
The 12-week consultation - which closes on 23 September, follows the judgement in the Pilots' National Pension Fund (PNPF) court case earlier this week, where the trustees had sought legal help on their powers to require employers with or without active members to contribute to reduce the £285m (€352m) deficit. (See earlier IPE article: Marine pilots ruling clarifies funding for multi-employer schemes)
Tim Jones, chief executive of PADA, said the last financial year was an "exciting and challenging" one for PADA.
"During 2009-10, we made substantial progress toward the delivery of NEST," he said.
"We remain on track to deliver NEST on time and at low cost, having made significant advances throughout the year against PADA's corporate plan."
These include the appointment of Tata Consultancy Service in March 2010 as the scheme administrators, and the planned transition from PADA to the NEST Corporation of trustees on 5 July.
Lawrence Churchill will become chairman, while Tim Jones will remain as chief executive.
However, the recent appointment of Jeannie Drake, acting chair of PADA, as a Labour peer in the House of Lords means she will be unable to take on the role of deputy chair of NEST Corporation. (See earlier IPE articles: NEST Corporation reveals trustee line-up and Tata confirmed as NEST admin provider)
In the meantime, Jones confirmed: "As the review progresses, PADA - and following the transition - NEST Corporation will continue to work on developing NEST to ensure all options remain available to the government."
As it stands, NEST is expected to be soft-launched in the first quarter of 2011 before it is fully implemented along with employer duties in 2012.