The Pensions Regulator

Our approach to DC regulation

The Pensions Regulator’s aim on work-based DC (money purchase) schemes is to use our approach of educating and enabling to reduce the risks to members’ benefits and promote and improve understanding of good administration.

We will consider using our powers to intervene where there are potential fraud implications, or, as a last resort, where other attempts to get the situation rectified have failed.

We have a statutory responsibility in relation to work-based pension schemes. These include occupational pension schemes, personal pension schemes where direct payment arrangements exist in respect of one or more members of the scheme and stakeholder pension schemes.

Two of our statutory objectives in relation to these schemes are to:

• protect members’ benefits; and
• promote and improve understanding of good administration.

We've identified the main risk areas appropriate for the regulator to focus on, namely:

• lack of member understanding;
• poor administrative practices;
• poor investment practices;
• unduly high charges; and
• poor decisions on retirement choices.

In order to mitigate these risks and to help people take opportunities to build on existing good practice, we're adopting a three-pronged approach:

• providing education and guidance;
• working in partnership; and
• intervention, proportionate to the level of risk.

Our online publications section provides details of our consultation exercise including the consultation report – 'How the Pensions Regulator will regulate defined contribution schemes in relation to risks to members'. 

We are part way through our programme focusing on our objective to protect members' benefits in DC schemes and to promote and improve understanding of good administration. Although we have made a good start, we recognise there is still a good deal to do.

We'll update our website periodically with new information and guidance on work-based DC schemes.