MPs to launch probe into DB pension regulation

The Committee has set out plans for its ongoing inquiry and is inviting evidence on Defined Benefit pensions regulation, as well as the role and powers of pension scheme trustees and relationships between TPR, PPF, trustees and sponsoring employers.

In its report, the Committee said: "it is imperative that the regulatory framework does not allow sponsor companies to evade those responsibilities and, in doing so, pass the burden onto other schemes that pay the PPF levy", adding that there "may be a case for stronger and more proactive regulation".

It will also look into the level and prioritisation of regulator resources, whether a greater emphasis on supervision and pro-active regulation would be appropriate, and whether specific additional measures for private companies or companies with complex and multi-national group structures are required.

The Committee has also raised concerns over TPR’s objective to “to minimise any adverse impact on the sustainable growth of an employer”.

The Committee continued: “The future of occupational pension schemes is perhaps the greatest challenge facing longstanding British businesses. In an environment of rising longevity, interest rates close to zero and intense international competition, defined benefit pension liabilities accumulated in a different age can appear burdensome and unaffordable.

"Investigating how to secure a fair and sustainable settlement will be at the centre of the Work and Pensions Committee’s ongoing inquiry.”

Rt Hon Frank Field MP, Chair of the Committee, said: “The lessons of BHS must be learnt. This may mean strengthening the powers and resolve of the Pensions Regulator to act early, quickly and firmly with those who seek to avoid their pension responsibilities. It is important, however, that businesses that are run reputably and responsibly are not put under undue restriction. Ultimately, defined benefit schemes must be placed on a sustainable footing.”