The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) have launched a joint regulatory strategy, identifying issues contributing to inadequate saving for retirement and outlining priorities for addressing fundamental challenges in the pensions sector.
The joint strategy sets out how the FCA and TPR will work in tandem in the future, with two new priorities for joint action identified.
The first is a strategic review of the entire consumer pensions journey. This will take an in-depth look at the tools needed to enable individuals to make decisions about their pensions.
Second, the two regulatory bodies say they will use their powers to drive value for money for members of pension schemes, including the setting and enforcement of clear standards and principles, where relevant.
Christopher Woolard, FCA executive director of strategy and competition, said: “We have worked closely with TPR to produce a co-ordinated and cohesive strategy that will produce positive results for people in or approaching retirement. But success in delivering this strategy doesn’t just depend on action by us.
“With the support and collaboration of the government, industry and consumers themselves, we can deliver an environment which contributes to people having higher incomes in their retirement.”
The FCA and TPR say the publication of the strategy marks a new stage in the evolution of their working relationship, having already launched a joint campaign to combat the risk of savers being scammed out of their pensions.
Lesley Titcomb, TPR chief executive, said: “The joint strategy further strengthens our close working relationship with the FCA, so that through our new approach we can together address earlier any issues that threaten the retirement outcomes for pension savers.
“Our goal is to ensure the people who run workplace pensions meet our expectations so that members can have confidence their savings are protected. We are being clearer, quicker and tougher in the pursuit of this goal and working collaboratively with the FCA is vital.”
Representatives of the pensions industry have welcomed the joint strategy.
Steven Cameron, pensions director at Aegon, said: “While the FCA and TPR have different remits regarding regulating pensions, there is now so much overlap that it’s very welcome to see a joint regulatory strategy, which we hope will lead to a long-term consistent approach across contract and trust-based pensions. This will benefit members who often have both types of pension, as well as ensuring efficiencies for schemes and providers through consistent regulation.”
Tom McPhail, head of policy at Hargreaves Lansdown, said: “A closer working relationship between the regulators can only benefit pension savers. There’s a clear indication that they’re targeting personal ownership of retirement to plug the saving shortfall in the auto-enrolment regime. The review of just what’s needed to help people make considered pension decisions should bring how to successfully engage members with planning for life after work to the fore.”