The Department of Work and Pensions has appointed Mary Starks to lead a review of the day-to-day running of The Pensions Regulator (TPR).
This is in line with expectations that regulators and other public bodies are reviewed each parliament to ensure they are properly accountable and delivering for taxpayers.
Starks has previously worked at the Financial Conduct Authority, as an executive member of the board, director of competition and chief economist, as well as previously holding an executive director role at Ofgem.
She is expected to deliver her review by May this year and all aim to identify efficiency savings of more than 5 per cent where possible.
Speaking about her forthcoming review Starks says: “The Pensions Regulator plays a vital role protecting the interests of savers and ensuring employees benefit from workplace pensions. As well as drawing on my own regulatory experience, I look forward to hearing from stakeholders from across the pensions sector and working closely with the teams at DWP and TPR.”
Minister for Pensions Laura Trott adds: “All public bodies must ensure that they are accountable and working for taxpayers.Mary Starks has a background working in the regulatory sector and with public bodies, which will help her to deliver effective recommendations.”
The review has been broadly welcomed by the pensions industry. However AJ Bell says they hoped it would provide an opportunity to ensure better alignment between DWP and FCA rules.
AJ Bell head of policy development, Rachel Vahey says: “The Pensions Regulator has an important task in making sure workplace pension schemes are operating in the best way possible for pension scheme members, protecting their savings and helping them to achieve a better financial later life. TPR has to oversee both defined benefit and defined contribution plans.
“It has to make sure it works closely with its sister regulator the FCA. There are many instances where the two cross paths, and it is up to both bodies to work closely together to design a robust and consistent regulatory framework, which works well on both sides of the regulatory fence.
“However, there have been instances where it has not always been the case – for example when designing a framework for stronger nudges to guidance, where we have different requirements for personal and workplace pensions.
“Likewise, when it comes to illustrations the FCA oversees those on point of sale documents, but illustrations included in annual statements are regulated by the DWP. Rather than adopt the same basis for calculating those illustrations, we are left with two systems using different methodologies and assumption to forecast the future value of an individual’s pension policy. This is clearly unhelpful for consumers, who need extra layers of pension complexity like a hole in the head.
“This has never been as important. Over the next year or so, the two regulators need to work together to develop a value of money framework for all pension plans, and roll out the implementation of pensions dashboards. And all against the background of a cost-of-living crisis.”
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