Distressed Pension Schemes: TPR's View

On 2 March 2012 the Pensions Regulator ("TPR") issued a report outlining the approach it might take in dealing with a distressed pension scheme. Whilst the report focuses on the Uniq pension scheme (last mentioned in our May 2011 article) it also provides useful guidance to other schemes in difficulty.

In detail

TPR confirms that its initial objective is to help employers and trustees identify whether a scheme is viable without a strong enough employer covenant.

If it is not, the employer, trustees and TPR will need to work together through various preliminary questions which will include:

• Whether a recovery plan would be viable?; and
• Whether the insolvency of the employer is inevitable?