The Pensions Regulator (TPR) has published update Covid-19 guidance asking trustees to resume reporting on “certain key information” from 1 July.

The update, which has also confirmed an extension to deficit reduction contribution (DRC) easements, emphasised that resuming reporting would ensure risks are being managed and savers protected.

It stated that this would allow TPR to “horizon-scan effectively”, and act as necessary to protect members.

Trustees will be expected to resume reporting on suspending or reduced contributions, with a revised recovery plan or a report of missed contributions expected alongside this.

It will also include late valuations and recovery plans not agreed, as well as any delays in cash equivalent transfer quotations and payments.

Master trusts meanwhile, will be expected to return to issuing a formal report to notify TPR of all triggering and significant events from 30 June 2020.

The update also outlined further guidance for defined benefit (DB) trustees facing employer requests to agree to suspend or reduce DRCs, stating that trustees may agree where it is necessary to support employers navigating the crisis.

The regulator stated that whilst data shows that around 10 per cent of DB schemes have requested a DRC deferment, and discussions are ongoing for others, there is a “need” for this easement to continue.

As such, it has now confirmed that trustees of DB schemes should “continue to be open” to requests to delay DRCs from sponsoring employees.

The regulator stressed however, that trustees should not "unquestioningly" extend original suspension arrangements based on limited information, and risk this becoming the "new normal".

Rather, it expects trustees to undertake due diligence on the employer's financial position before agreeing a new suspension or reduction, stating that it expects “greater insight” into an employer’s short-term liquidity to have developed since the start of the lockdown.

It explained that discussions with lenders will have likely progressed, and employers are now also more likely to have financial projects reviewing the likely impact of Covid-19 on their business, allowing trustees to review "in more detail" the business case for a suspension or reduction in contributions.

This also follows the recent prediction from the regulator that the number of employers requesting DRCs would continue to rise, as many firms begin to renegotiate their recovery plans.

Easements around cash equivalent transfer values (CETV) however, will not be extended, with the regulator highlighting that a “normal level” of activities appears to be resuming.

Trustees should however, continue to issue a letter template to all members requesting a CETV quote as introduced in April, and should “monitor requests for concerning patterns”.

Commenting on the update, TPR chief executive, Charles Counsell, stated: "Covid-19 has had a huge impact on us all and so during this unprecedented time we have continued to listen and talk to trustees and employers.

"We are determined to help where we can by taking a pragmatic approach while remaining focused on the need to protect savers.

"The information we issued in March and April remains relevant and today’s updated guidance outlines how we are continuing to support schemes in these challenging times.

"In making decisions on regulatory action, we will continue to do so on a case-by-case basis and take a flexible and pragmatic approach where breaches are Covid-19 related.

As such, we feel the resumption of some reporting is now important."

However, TPR has confirmed that it will continue to give defined contribution and automatic enrolment providers 150 days to report late payment of contributions, compared to the typical 90 days, though this will be reviewed at the end of September 2020.

It also stated that it would continue to take a “pragmatic approach” towards annual benefits statements, acknowledging that the impact of the pandemic will likely mean schemes need additional time to issue these to members.

Trustees will be asked to report any failure to prepare audited accounts, although TPR stated that it would “not be looking to take enforcement action on late accounts signed off by 30 September 2020”.

TPR also stated that whilst the legislation around chair’s statements does not allow for discretion in relation to enforcement, it does not expect to review these statements before the autumn.

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