The Pensions Regulator (TPR) has called on the industry to work together to enhance the pensions system, support innovation in the interests of savers, and protect savers’ money.

Speaking at an industry event, newly appointed TPR CEO, Nausicaa Delfas, outlined her main priorities and called for a joint effort to meet a new ‘pensions challenge’ to ensure the system delivers value right the way, and not simply focus on costs.

Indeed, value for money was a key theme in the speech, as Delfas warned that there is a “lack of innovation and fluidity in the market” that is leading to significant investment risks in a rapidly growing market which needs to adapt.

Given this, she argued that the pensions industry needs to move away from a short-term focus on cost to deliver real, long-term, holistic value for savers.

“We want industry to change its mindset," she stated. "From prioritising low costs to putting value first. And by doing so to drive innovation in the interests of savers.”

She also highlighted the expected impact of the new joint framework currently being developed by the Department for Work and Pensions, Financial Conduct Authority and TPR, suggesting that this will increase transparency and competition in the market and drive-up standards across the board.

"Properly instituted and given its rightful place at the centre of thinking, our work to deliver value for money should be a game changer," she stated.

“We need to make genuine changes to the system, not merely adjust some minor points. We need fundamental shifts in thinking and delivery.”

Addressing Professional Pensions Live, Delfas also made clear that TPR would be looking to make use of its powers and challenging trustees not prepared to leave the market and put savers into better run schemes if they cannot meet the standards TPR expect.

She continued: “Consolidation continues at pace within DC and our position is clear: no saver should be in a poorly performing scheme that doesn’t offer value for money.

"Where we find poor performance, the message is clear: wind up and put your members into a better run scheme. Or we will consider all powers at our disposal.

“Where there may be barriers or practical issues, we will work with the market to address them - for example where guaranteed annuity rates exist in DC schemes — and we will be crystal clear with all trustees about what is expected of them, and when.”

Delfas also said that TPR is “unapologetic” in the high standards of administration and governance that it is expecting, including to address equality, diversity and inclusion and environmental social governance issues.

"Savers deserve more than minimum standards — we are unapologetic about the standards we expect from trustees — savers would expect the people looking after what is for many their entire retirement savings to be appropriately skilled and qualified.”

In line with these efforts to raise standards, Delfas also confirmed that TPR will be pushing towards greater professional trusteeship, arguing that "we should all do more to ensure that every trustee body has an appropriate level of skill and professionalism".

"We are asking you to consider: ‘Is our offering the right one’? These are tough, searching considerations, but absolutely the right questions to be asking as we address the pensions challenge." she stated.

“In order to achieve all of the ambitions here, fundamentally we believe that every trustee body should include someone who meets professional standards.”

“We need to do this so that pensions deliver a pot that enables savers to have confidence, empowerment and security in later life," she added.

“We need to do this to support savers when they come to use their money. And we need to do this to make the process of decumulation clearer and more accessible, and to ensure we protect savers from scams, poor advice, and lost value.”

Share Story: