Pensions - Articles - TPR authorises the UKs first CDC pension scheme

 TPR has now published a list of authorised CDC schemes on its website.

 The authorisation is a milestone for TPR and shows how the regulator is pursuing its strategy to embrace innovation to help meet pension savers’ needs.

 TPR’s Executive Director of Frontline Regulation, Nicola Parish, said: “I am delighted that we have authorised the first CDC scheme, which is a clear demonstration that we are serious about embracing innovative approaches to deliver the pensions of tomorrow.”

 Minister for Pensions, Laura Trott, said: “TPR authorising the first CDC scheme is a landmark moment, and this is just the beginning. We have seen the positive effect of these schemes in other countries and our plans to extend our CDC framework will enable more pensioner savers to achieve the retirements they want.”

 The Pension Schemes Act 2021 introduced an authorisation and supervision regime for CDC schemes. They must show they meet stringent criteria including that those who run the scheme meet fitness and propriety requirements, have the right systems and processes in place, can show the scheme is financially sustainable and have robust member communications. TPR has powers to intervene when necessary.

 Currently, CDC schemes can be set up by single employers, for that employer only, or for employers in the same group of companies.

 The Act also contains powers to enable further developments of the CDC market, such as schemes for groups of employers who aren’t legally connected. Earlier this year, DWP consulted on extending opportunities for CDC schemes and will respond in due course. TPR is working closely with the DWP in this area.