The government should introduce mandatory minimum administration standards, according to Trafalgar House, but the third-party pensions administrator cautioned against increasing complexity in an already complicated regulatory regime.

Responding to the Department for Work and Pensions’ (DWP) consultation entitled Trust-based pension schemes: trustees and governance, building a stronger future, the firm warned that an overly complex regulatory regime could “harm member outcomes”.

While it broadly welcomed the direction of travel of the DWP consultation, Trafalgar House emphasised the need for “practicality over process”.

Its key recommendations included the introduction of mandatory baseline standards for pension administrators and relevant integrated service providers (ISP); avoidance of a full FCA-style regime, which it said would increase costs but not necessarily service; recognition of existing assurance frameworks, accreditations and certifications; clear expectations for cyber governance and transition oversight; and a trusteeship reform that aligns with administration reform.

Commenting on the response to the consultation, Trafalgar House managing director Garry Wake said: “Stronger governance only works if it drives better outcomes, not just more paperwork. Too often, the pensions industry equates more oversight with more effectiveness.

“This consultation is a genuine opportunity to raise the bar, but it will only work if reforms reflect how administration risk actually arises at scheme level, not just how it looks on a whiteboard.

“Reforms must remain proportionate, outcomes-focused, and grounded in the practical realities of administering pensions in today’s environment.”

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