The National Association of Pension Funds has reiterated calls to create a single pensions regulator and warned auto-enrolment will make the current regime “increasingly unsustainable”.
Pensions regulation is currently split between the FCA, which regulates contract-based schemes, and The Pensions Regulator, which is responsible for regulating all workplace pensions, including trust-based defined contribution schemes.
The Government has come under increasing pressure to re-examine the regulation of pensions. In April, the Work and Pensions select committee said persisting with the current framework could lead to “gaps” in regulation, potentially putting members’ savings at risk.
Speaking at the NAPF conference in Manchester today, outgoing NAPF chairman Mark Hyde Harrison urged policymakers not to “dodge” the issue of regulation.
He said: “The mass DC market brought about by auto-enrolment will mean that the current regulatory split of the market between The Pensions Regulator and the Financial Conduct Authority will become increasingly apparent – and increasingly unsustainable.
“With pensions becoming an employer duty, and with the growth in the numbers in pensions, it can only be a matter of time before we move to a single regulator for occupational pensions.
“Any shift won’t be easy but it doesn’t mean we should dodge the issue. The priority has to be ensuring better and fairer pensions for people.”
Hyde Harrison also backed efforts to increase transparency of costs and charges in pension schemes but insisted capping prices is “not the solution”.
In addition, he urged the Government to steer clear of further reforms to pension tax relief and warned excluding small firms from auto-enrolment would be “disastrous”.