Partner Jane Kola comments in Pensions Expert in relation to the Pensions Regulator’s draft policy on the use of its new criminal powers
There are continued concerns around the Pensions Regulator’s draft policy on the use of its new criminal powers, which are included in “clause 107” of the Pensions Schemes Act to enter into force in autumn this year.
A recent survey shared with Pensions Expert quantified the industry’s dissatisfaction, showing that only 19 per cent of people interviewed said that the Regulator’s criminal powers policy is ‘adequately clear’, while 65 per cent said they feared it could prompt companies to ditch their pension arrangements, leaving the regulator with much to do to win back industry trust.
It has been reported that it is believed that the clause was so broadly drafted that all manner of legitimate business activity could fall within its scope.
As a response to the concerns that have been raised since January, TPR published a list of illustrative scenarios as part in order to put minds at ease about the type of activity it will go after. However, these have widely been considered inadequate, principally because they deal only with extreme cases and not the more common and more nuanced examples the industry will face on a daily basis.
Jane Kola commented she “had hoped the guidance would include more scenarios and examples to help everyone see more clearly where the line between criminal and non-criminal activity might be drawn given the breadth of the wording of the offences”.
Jane also said:
“There is very little indication of how trustees and sponsors might get more comfort that they are in the right ‘ball park’ in terms of what they are doing, especially in tricky circumstances,”
Jane concluded “it is simply not good enough to say that it is looking at the criminal offences in a similar way to its current anti-avoidance powers, as the two are different both in terms of their intent, their wording and their consequences”.
Read Jane’s comments in Pensions Expert.
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