The NAPF report says issues around defined benefit inflation proofing, DB employer cov- enant regulation, governance requirements and DC contract-based provision need to be addressed. It says mandatory inflation proofing in the UK is out of step with regulation elsewhere.
On DB employer covenant regulation, the NAPF says if mandatory indexation was removed, it would be easier to apply higher funding levels and reduce the need for such stringent regulation of the covenant.
The NAPF believes the UK requirements for governance in trust-based schemes are high and consideration should be given as to whether this approach is proportionate.
It says regulation of contract-based schemes, especially group personal pensions, is out of line with the regulation of similar DC schemes in most other countries.