IAPF Spring 2018 Irish Pensions Magazine

IRISH PENSIONS MAGAZINE | SPRING 2018 | 37 FEATURE advance. It will be expected, of course, that if trustees are receiving greater access to management information, forecasts, business plans or whatever form ‘employers providing information more regularly’ takes, they do something with it. If employers and trustees are placed in a position where they can truly negotiate, especially if a debt on the employer does come to fruition, then it follows that funding plans would also be up for discussion which may mean, in some cases, flexibility on the length of those plans may be required – which would necessitate the trustees assess what is affordable, over what period and if the sponsor has sufficient longevity to last the distance. That position would then need to be monitored, to some degree. In the United Kingdom, as a result of the Pensions Act 2004, there was a significant reform of the pensions system. Out went the Occupational Pensions Regulatory Authority and the Minimum Funding Requirement and we were introduced to the new sheriff in town, the Pensions Regulator (TPR) and the concept of ‘employer covenant’. Employer covenant is described by TPR as the ‘ability and legal obligation’ of an employer to support The measures mooted by the Government include: • Requiring more frequent provision of information to the Pensions Authority to allow closer monitoring and scrutiny of scheme funding provisions; • Requiring the employers to provide information more regularly to trustees to allow them to plan for future viability of their scheme; • Providing for early notification to the Pensions Authority of any scheme difficulties or changes in the sponsoring employer that will affect the scheme; and • Giving increased powers to the Pensions Authority to take action to direct schemes and sponsoring employers to develop proposals that will allow schemes to survive, or put in place well-funded alternatives. These proposals very much echo elements of the UK system, particularly in relation to trustee/ employer interactions - there needs to be regular discourse, the sponsor’s position should be monitored and the impact of material changes to employer structure should be considered, wherever possible, in