NAPF attacks TPR master plan

The NAPF has attacked the Pensions Regulator’s newly launched master trust kitemark arrangement, saying it is overly complex and will place extra costs on schemes.

TPR and ICAEW launched the voluntary assurance framework for master trusts today. It is designed to enable trustees of master trusts to demonstrate to employers that their scheme is managed to a high standard has been published today. The assurance framework sets out how trustees should report against a series of ‘control objectives’ related to governance and administration, which are aligned with the regulator’s DC quality features, and which procedures practitioners must undertake.

The NAPF says TPR should have gone for a principles-based approach instead, and argues a rigid framework will be unable to adapt to changes in regulatory and market conditions.

NAPF policy lead, defined contribution pensions & investments Richard Wilson says: “We support the aims of this framework and it is right that the regulator encourages master trusts to meet these standards.  However, the NAPF favours a simpler, principles based approach to master trust regulation – one that makes sure trustees are independent, have robust powers and charges them to protect members’ interests.

“Master trusts, like all occupational pension schemes, are dealing with massive change.  They are currently implementing automatic enrolment and grappling with the development and implementation of the guidance guarantee as well as changes to the rules on charges and governance – all of which must be delivered to a very tight timetable.  Any additional regulation can only push up costs and this framework may also struggle to keep up with the current pace of change.”