A new-look Pensions Regulator

TPR is transforming itself as it continues to adapt to the changing face of the UK pensions industry.

The Pensions Regulator (TPR) is to overhaul its structure from April to reflect ongoing changes to the UK pensions landscape.

Last week, TPR announced a significant transformation of its operational structure as it adapts to an industry with fewer, larger pension schemes. The changes are designed to better protect savers and ensure the market functions effectively, the regulator said in a statement.

TPR chair Sarah Smart said: “We are moving from a fragmented pensions landscape of thousands of small schemes to an environment of fewer, larger schemes. That means we need to change our regulatory approach to protect savers in the future.

“The market should expect us to engage with it differently from now on. Our new structure means we will be swifter to address compliance failures and market-wide risks while being more dynamic in our industry engagement and bringing innovation to the fore.”

TPR’s most recent defined benefit (DB) scheme data, published last week, showed that the total number of private sector DB funds had fallen from 6,974 in 2013 to 5,297 in 2023, a drop of 24% in 10 years.

TPR’s new structure
From April, the regulator explained it would be creating three new regulatory functions as it engages differently with the market.

The regulatory compliance function will ensure that employers and schemes meet their obligations and protect savers’ interests. This will include much of the work currently undertaken by TPR’s frontline regulation division, including enforcement, intelligence, customer service and regulatory transactions.

The market oversight function will engage with schemes “and others who influence pension savers’ outcomes” to ensure value for money and effective governance.

Finally, the strategy, policy and analysis function will use data and industry insights to drive improvements to the regulatory framework and support innovation to the benefit of savers.

The changes come amidst significant shifts in the pensions landscape. Automatic enrolment has brought millions into workplace pensions, and master trusts have become the dominant vehicle for defined contribution (DC) saving. DB pensions, meanwhile, are becoming increasingly rare, with employers exploring consolidation options such superfunds.

TPR chief executive Nausicaa Delfas said: “We have to make sure that workplace pensions work for savers. Our organisational changes are about bringing our talented and capable colleagues together to protect, enhance and innovate in savers’ interests.”

These changes will come into effect in April 2024. TPR said it would recruit permanent leadership for the new functions while implementing the changes with temporary internal appointments.