Scheme Funding: The Pensions Regulator Is Always Watching

The seemingly Sisyphean task of paying off the defined benefit pension schemes' funding deficits grinds on. The scheme-specific funding regime provides for trustees and employers to agree a recovery plan to clear any deficit in the scheme over a reasonable period at the scheme's triennial valuation. This can be a difficult negotiation as employers want to limit their contributions to the minimum required, whilst trustees want to clear deficits as fast as reasonably possible, and these positions are difficult to reconcile. 
A recent section 89 report by the Pensions Regulator (the Regulator) highlights the need for parties to eventually come to an agreement. The report details the Regulator's involvement in a protracted funding dispute between the trustees of the Docklands Light Railway (DLR) Pension Scheme (the DLR Scheme) and the Scheme's employer, Serco Limited (Serco), and demonstrates the Regulator's willingness to exercise its powers where schemes have missed