Pensions - Articles - Hymans Robertson comments on TPR criticisms on Carillion

Patrick Bloomfield, Partner at Hymans Robertson responds to the criticism of TPR in this morning’s report on Carillion: “The work of toughening up TPR has already begun. Assertive intervention, directive funding guidance and recent prosecutions have shown that it is willing to pursue failing employers.

 This will continue to gain momentum in 2019 as the White Paper become a Pensions Bill and TPR writes a tougher Code of Practice. The focus must now be on making TPR’s existing strong powers easier for it to access, so they can be executed frequently and change company director behaviour towards pension schemes.

 “The Government also needs to reflect on TPR’s irreconcilable objectives to promote sustainable economic growth and protect pension schemes and the PPF. Carillion, BHS and Tata Steel have swung the legislative pendulum heavily towards protecting members. However, any sluggish economic performance in the future would swing this pendulum back to protecting business growth and tax revenues. Both the industry and regulators need consistency across economic cycles, especially when dealing with multi-decade pension issues.

 “Carillion’s legacy will be to toughen TPR. Corporate failure has always been the catalyst for pension legislation. For instance, Maxwell led to the Pensions Act 1995 and Allied Steel & Wire led to the Pensions Act 2004. It is not the pensions industry’s place to be apologists for its regulators. The sad reality is that thousands of examples of good practice are undermined by a few spectacular failures. The consolation is that we can use these failures to raise the bar.”

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