“This is a somewhat pragmatic response from TPR, not enforcing the appointment of a professional trustee but raising the bar in terms of the knowledge required across the board. However, given the increasing complexity of the environment in which schemes operate, and the difficulty which many lay trustees have in finding both the time and employer support required for their role, the net result may well be similar.
“For many, the response is the only route that the Regulator could reasonably take. That said, it is clear that this is not the end of the road for the future of trusteeship. Education and understanding are vital in the drive to improve industry standards but TPR will want to see demonstrable change.
“We do though expect to see good progress on this front as increased surveillance from the Regulator should encourage those involved in pension scheme governance to take on board recommendations around ongoing learning.
“The message is similar in terms of consolidation, in that TPR does not want to fall into the trap of a ‘one size fits all’ approach. So, if a scheme is well run and can demonstrate that it is offering value for members, TPR would not expect the trustees to consolidate. Conversely, those that do not make the grade will need to consider their options.
“TPR’s overall message is crystal clear – while measures around sole and professional trusteeship are yet to be mandatory, standards will continue to be monitored.”
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