Pensions Regulator boosts budget following rise in avoidance cases
Share
The Pensions Regulator has boosted its core budget for 2010-11 to £29.5m, up £1.3m from the previous year, claiming an increase in avoidance cases has doubled its workload.
The Employer Compliance Regime, which will police the Pensions Act 2008 reforms including auto-enrolment, will cost a further £10.4m for 2010-11, although the Department for Work and Pensions is footing the set-up costs.
In its latest corporate plan, published today, the Pensions Regulator says the increase in its core budget, which is paid for through a general levy to firms, is to ensure it copes with the reforms as well as keep up with a continued increase in workload due to the economic downturn.
It says it plans to focus more attention on defined contribution risks and to review its approach to late payments by employers.
The plan states: “Both are likely to require additional areas of work, as is the development of our approach to the regulation of the National Employment Savings Trust and other industry responses to the workplace pension reforms.
“We are still experiencing an increased workload as a result of the economic downturn. The case work is more complex, often demanding a higher skill set.
“We are seeing more avoidance cases, with the case load more than doubling from last year - and these take longer to resolve. There are many more schemes in deficit, and we are seeing more schemes that require input on governance and administration issues.”
The Pensions Regulator says the cost of the ECR programme team for 2010-11 excludes any costs of operation of a prime contract to run the compliance regime.
It says it anticipates there will be higher business as usual costs associated with an increase in schemes from 2011-12 onwards and that these will be met by higher receipts from the general levy from the increased number of schemes.
If you enjoyed this article, sign up here to receive daily email updates from Money Marketing and Follow @_moneymarketing
