Today The Pensions Regulator (Delegation of Powers) Regulations 2009 (SI 2009/1888) were laid before Parliament, to come into force on13 November 2009. The Regs will allow The Pensions Regulator (TPR) to delegate enforcement of the employer duty from October 2012 to automatically enrol workers into, and contribute to, a workplace pension arrangement. Although TPR can thus outsource implementation of the new compliance regime, it will retain accountability for any functions it chooses to delegate.

These regulations were put out alongside the Pensions (Automatic Enrolment) Regulations 2009 (see Aries article), which have not yet been laid. The Government has formally responded to the consultation, which began on 12 March and concluded on 3 June 2009. The DWP regards these regulations as non-contentious, as there were only nine formal responses to the consultation, compared to 79 responses to the consultation on the auto-enrolment regulations.

The accompanying Explanatory Memorandum sets out the role of the Enabling Retirement Savings Programme (ERSP), a collaboration between DWP, TPR and PADA, to implement reforms under the Pensions Act 2008 to increase the number of people saving for retirement and the amount being saved.

The ERSP encompasses:

• the introduction of automatic enrolment into a qualifying workplace pension and a compulsory minimum employer contribution;
• a compliance regime to ensure employers meet their obligations; and
• the setting up of a new low cost simple pension scheme - currently referred to as the personal accounts scheme - to ensure all employers have access to a suitable pension scheme in order to meet their new duties.

Aries comment

The new employer duties extend TPR's responsibilities considerably, and will require substantial work to handle communication with employers and intermediaries and administer the compliance and enforcement regime. Clearly - and probably correctly - the Government does not believe TPR on its own is adequately resourced for this task. Its predecessor Opra notoriously only managed to prosecute one employer for failing to designate a stakeholder pension scheme; any such dismal regulatory enforcement of the 2012 regime is unthinkable. Furthermore, enforcing compliance with the PA 2008 regime - for example, the prohibition in section 54 on inducing opt-out from a qualifying pension scheme - will be a challenge of a different order.

Trustee Knowledge and Understanding (TKU): update from Regulator

Meanwhile, following a 12-week consultation on the draft revised trustee knowledge and understanding (TKU) code of practice and scope guidance (see Aries report), TPR has announced widespread support for the TKU regime. TPR thinks that early fears that TPR's expectations would grow have been relieved, with most respondents considering the requirements have not changed substantially. The revised code and scope have not changed much either.

The draft revised code recognises the unique requirements of trustees of very small defined contribution schemes, with 12-99 members, and TPR has developed "slimmed down" guidance for this group. This was consulted on within this exercise. Trustees of schemes with fewer than 12 members remain exempt from the requirements.

The draft revised code is laid before Parliament and the Northern Ireland Assembly and it is expected that the revised code will come into effect later in this year.

A lot of feedback was also given about the Trustee toolkit. Some respondents commented that the toolkit should be complemented by scheme specific training given by an appropriate adviser or industry trainer. TPR agrees that different requirements will be appropriate for trustees of different types of schemes and at different levels. The Aries Trustee & Administrator Training System is a flexible, user-oriented CD-ROM alternative which some find more convenient and easier to follow.