TPR publishes interim response on new data requirements

TPR has today published its interim response to its consultation on the data it expects trustees to submit as part of their ‘Statement of Strategy’. This is required under the new Funding Regulations – in force for schemes with valuations from 22 September 2024.

For the first time, many schemes will have to provide detailed covenant information to TPR. A positive change from the initial consultation is that many smaller and/or better funded schemes no longer have to provide this information, with some schemes not having to provide any covenant data at all. We are also pleased to note that figures can be submitted in terms of ‘at least’ – allowing trustees to take a more proportionate approach to compliance, than was initially posited in the Consultation.

Moving between the Fast Track and Bespoke Approach also affects the required investment information. For Schemes on the Fast Track, the Statement of Strategy requires similar information to that provided in the current scheme return. For those schemes on the Bespoke Approach, the information needed would probably form the foundation of an investment strategy review for a substantial scheme. However, schemes with less sophisticated investment governance may find they need more information from their investment advisers. It will be absolutely vital that actuaries and investment advisers work together to deliver value for money.

Whilst there is a lot to think about for trustees, we will take it in our stride. We will already have considered how sponsor covenant can support our schemes in the longer term, however we might not have explicitly considered and shared data items like ‘reliability period’, ‘longevity period’ and ‘maximum affordable contributions’. The same may be true of the details required relating to investment strategies.

At IGG, our dedicated Centres of Excellence for Covenant & Restructuring and Funding & Investment are considering this in more detail, including what it means for our schemes and clients, and how we can proportionately ensure regulatory compliance with these new requirements. If you would like to discuss this further, please reach out to your IGG contact.

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