Scope of the inquiry
The Committee has opened a new, dedicated strand of work on The Pensions Regulator (TPR)’s priorities and approach, starting Wednesday 26 June 2019 when the Committee will question new Chief Executive of The Pensions Regulator Charles Counsell.
Since the collapse of British high street chain BHS, and two years later massive public outsourcer Carillion, both leaving large pension scheme deficits, the Committee has conducted intensive scrutiny of the role and powers of TPR and how it uses them, including in its dedicated Pension Protection Fund and Pensions Regulator inquiry. Long-expected new legislation on pensions, including on TPR’s powers, has yet to materialise after various protracted consultations on changes to the corporate and pensions legislative frameworks.
Questioning in this first session is expected to include TPR’s ongoing negotiations with Arcadia, Sir Philip Green’s “retail empire” which recently, narrowly passed a vote of major creditors after proposals for funding its estimated £537 million to £727 million pension deficit were cleared by TPR and the PPF, and whether the lessons of BHS have now been learnt by the regulator, particularly in its approach to schemes and sponsors in a precarious position. After the Arcadia creditors’ vote on 13 June, Chair Frank Field wrote to Charles Counsell with a further series of detailed questions about the cash and assets on offer for plugging the scheme deficit.
Questioning will also include the wider corporate regulatory framework, in light of the experiences at BHS and Carillion, including the extent to which companies carrying large pension scheme deficits should be able to pay out dividends and bonuses. It is also likely that there will be questions on new pensions regulatory developments, including the introduction of an entirely new pension model, for the UK, of CDC pensions; and questions over TPR’s fitness and ability to regulate emerging new types of pension scheme “consolidator” such as master trusts and potentially, superfunds.
The Department rejected the Committee’s suggestion that the incoming chief executive of TPR should be subject to a “pre-appointment hearing”. Instead this first evidence hearing on June 26 will focus on the new incumbent’s priorities and approach in the role.