The Pensions Regulator's (TPR) 2023/24 Corporate Plan has revealed a delay in the launch of the new Defined Benefit (DB) Funding Code, from October 2023 until April 2024.

The new code is expected to improve TPR's ability to ensure that savers in DB schemes get the money promised to them and enhance the regulator's ability to protect savers.

TPR's Corporate Plan stated: "We are preparing to introduce a new funding code in 2024, which will establish a much stronger set of standards for DB schemes.

"A new requirement for trustees to set a long-term funding objective will help ensure that the promises made to savers are kept.

"The code will make clear that schemes must reduce their reliance on their sponsoring employer as they become increasingly mature and manage risk effectively.

"Trustees also need the flexibility around funding to suit their individual circumstances, which the code will provide. The regulatory framework we build will enable us to act effectively where we need to."

TPR had previously suggested that the code was set to launch in October 2023, although industry experts argued that this timeline was "ambitious", with calls for TPR to provide an update or delay the code.

The Pensions Minister also recently confirmed that the timing for the DB funding regulations would be somewhat dependent on an update from the Work and Pensions Committee, in order to reflect any recommendations around liability-driven investment (LDI).

In addition to the update on the DB Funding Code, TPR emphasised its commitment to value for money in its Corporate Plan for 2023/24, warning that those schemes that can’t provide good value for money must "improve or leave the market".

In line with this, TPR highlighted ongoing work with the Financial Conduct Authority (FCA) and the Department for Work and Pensions (DWP) to develop a value for money framework as a "key priority" for the year ahead.

It also confirmed that it will take regulatory action where needed, such as where schemes do not undertake value for member assessments or where unremedied shortcomings are revealed, and will look to step up its engagement with administration providers.

Alongside this, TPR confirmed that it is looking to lay the foundations for a significant increase in addressing quality outcomes in defined contribution (DC) schemes, as well as increase its attention on tackling scammers through the Pension Scams Action Group.

Although 2023/24 is the third and final year inTPR’s three-year planning cycle, the Corporate Plan also provided an overview of TPR’s plans beyond March 2024, including a “transformation in its approach to regulating DB pensions”.

Value for money also remained a focus looking longer term, as TPR confirmed that it plans to work with the DWP to explore options for better protecting value at decumulation for members of defined contribution schemes, highlighting this as demonstration of its commitment to enhancing the value for money savers receive.

The regulator also said that it will look to assess the feasibility of mandating that a professional trustee sits on each board or accrediting or authorising professional trustees, in order to lay the foundations for work with the DWP to progress the most suitable approach.

More broadly, TPR will be looking to deliver a number of new regulatory regimes for the assessment, authorisation and supervision of new models, such as DB superfunds and multi-employer collective DC (CDC) schemes, as well as developing a regulatory framework to support pensions dashboards.

TPR chair, Sarah Smart, highlighted the latest Corporate Plan as demonstration of how TPR will continue to deliver on its commitment to protect saver outcomes, by pushing hard for ever-higher standards of trusteeship and governance and by fighting to beat scammers.

She continued: “A key theme in the plan is that we — working with our partners — expect schemes to provide good value for money. Those that can’t, must improve or leave the market.

“We will continue to work closely with our partners and maintain a robust focus on our core activities that drive compliance with regulations.

“We have an important year ahead with much to do and I am confident that we have the right team to do it. I am delighted to welcome Nausicaa Delfas to TPR as our chief executive.

"Nausicaa shares our commitment to savers and our other priorities, including equality, inclusion and diversity, and will drive forward our agenda to put savers at the heart of what we do.”

Adding to this, Delfas stated: “As our Corporate Plan sets out, we have a full and ambitious agenda for the benefit of millions of savers.

"We will continue to focus on protecting savers’ money, enhancing the pensions system and, as we look to the future, helping to drive innovation in savers’ interests.

“To deliver our plan, we will continue to build our organisational and digital capabilities, deliver value for money, and work collaboratively with our regulatory partners and stakeholders in the wider pensions environment.”

TPR's total budget for the 2023/24 work is £118.9m, representing a £1.7m increase against the 2022/23 budget, with a £1.6m increase for levy and a £0.1m increase for automatic enrolment.

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