Pensions regulator urged to boost transparency on auto-enrol fines


The Pensions Regulator is being urged to publish the details of the fines it imposes on firms which do not comply with auto-enrolment rules.

Last month, the regulator revealed it had handed out its first escalating fines for failure to comply with auto-enrolment rules.

TPR’s quarterly compliance bulletin shows 198 firms were hit with £400 fixed penalty notices between January and March, compared to 166 in the last three months of 2014 and just three firms in the previous quarter.

The regulator also issued its first four escalating penalties. These can range from between £50 and £10,000 a day depending on the number of employees affected but TPR would not say what level of fines have been issued.

A spokesman for TPR says it does provide case studies. He says: “We publish figures on use of our powers, as well as information on trends and lessons learned from our casework in our quarterly compliance and enforcement bulletins and other publications.

“We will continue to keep the information we provide to the market under review.”

But experts say TPR’s reluctance to provide specific details of fines, including amounts and infringements, is impacting their ability to advise firms.

Law firm Pinsent Masons head of pensions strategic development Robin Ellison says: “There’s going to be a debate between the Department for Work and Pensions and TPR’s enforcement division. The TPR is not being as transparent as I would like it to be as it is beginning to fine people but not telling the public why the fines are being levied.

“You can’t work out whether this is insistent non-compliance or whether it’s just accidental, for example they ffilled in the form wrongly.

“I’d like to see a lot more transparency, which would help people like me help clients. At the moment I can’t tell what’s been going on, what mistakes are happening, and whether the fines are proportionate to the offence.”

LEBC divisional director of group savings and investments Glynn Jones says: “The TPR wants to continue to portray auto-enrolment as a success. It’s about positive spin – the whole point is to try to keep a lid on it. But knowing that information [about the fines] could really contribute to our understanding.

“With 1.1 million employers to come, most of which don’t have access to advice, the regulator wants to make it sound like it’s all working fine. If we had access to detail we can get ourselves better educated and armed to help people when the crunch comes.”

The People’s Pension head of policy Darren Philp says TPR has done a good job of helping employers but has recently begun automating fines as its workload grows.

He says this development will make it increasingly difficult to differentiate between “wilful non-compliance and mistakes”.

He says: “Auto-enrolment is new, information about where things are going wrong would be helpful. If TPR is fining people there needs to be transparency.

“Up to now the regulator has been quite pragmatic, but as the fines becomes more automatic it’ll be more difficult to do that.”

But Pensions Playpen founder Henry Tapper aruges the industry has an unhealthy obsession with fines.

He says: “TPR is about promoting best practice and enforcement is a sideline. Everyone’s getting obsessed with enforcement and forgetting that most of TPR’s work is about helping firms comply. Far too much scrutiny is being paid to the relatively small number of fines.

“We’d be much better off spending our time and energy what TPR is doing to help things, rather than worrying about the cases which have gone wrong.”