Response to the Consultation
The Institute of Directors is pleased to have the opportunity to respond to this consultation document. We would not propose to answer the consultation questions in detail but would make the following observations.
- Overall, we welcome the approach to regulation of DC schemes outlined in the papers. We think there is now a clear and coherent approach to regulation which is pragmatic in nature. In particular, we welcome the fact that the Pension Regulator to the 5 principles for better regulation enshrined in the Legislative and Regulatory Reform Act 2006.
- Equally, we would take the view that the regulatory framework for DC schemes is now as complete as will ever be needed. It should only be added to, or amended, in the light of clearly identifiable developments which clearly justify such action.
- We remain concerned at the continued overlap between the Pensions Regulator and the Financial Services Authority in the area of workplace contract-based pensions. Whilst there is no current evidence of matters of concern in this field as far as we are aware, the weight of regulatory interest in these pensions is perhaps disproportionate to the risks they might pose. There is also the potential for incomplete coverage and we note, for example, that the DC Code and Regulatory Guidance do not apply to such workplace pensions, but the 6 DC Principles and DC Qualifying Features will apply. Our thinking is moving towards the idea that
workplace pensions of all types should be under the jurisdiction of just one Regulator if at all possible.
We hope you find these observations helpful and we would be pleased to discuss them in more detail with you.
Senior Adviser, Pensions Policy