What Google thinks a “single DC regulator”.

Hywel offers a fine observation based on the dim and distant days when he was a junior pension lawyer.

It has been a long time since we had a “DC pension”. Not since the days of 226 plans where the transfer from a with profits accumulation to an annuity was established making the phrase “226 pension” as close to the DB experience that could be had with a stable premium paid by the saver and an often guaranteed rate of exchange. That guarantee was a torpedo that sank HMS Equitable Life and did huge damage to the concept of “money purchase pensions”.

There was nothing like the FCA and TPR when I started in 1983. There was only the Occupational Board and after it OPAS. Pensions in those days were pensions paying a lifetime income with no “freedom ” form pensions till transfers to personal pensions were allowed in 1988. That was the first time that people could choose to be protected by a retail rather than an institutional regulator. It was a day when the data room got a big extension!

We have been moving away from pensions ever since and this insistent change in balance where risk has moved from insurer to the future pensioner has resulted in the physical data rooms that Hywel describes. Thankfully we have digital data these days which saves on trees and paper but doesn’t reduce data production.

Today is another day of change for data – another extension for the data room. We will have a CDC fund code by the end of July (we’re there!) This Code will become operative tomorrow and effective from Monday when our Pension Regulator has slept off a night out watching Nick Cave in Brighton’s Preston Park.

We estimate it will take 1,000 pages of digital data to submit our application to be a CDC scheme. We don’t know will be joining us but you can imagine the sheer quantity of data which will rest with TPR.

Meanwhile, large parts of the advisory community, focussing now on SIPPS and workplace GPPs will be creating more data as each quarter the FCA creates new requirements of advisers and providers. Instead of 226 schemes mimicking private DB plans , we have a range of ways to get people through retirement through their own and their employer’s efforts.

We are in the second iteration of CDC legislation and regulation, it is to establish multi-employer workplace plans to replace existing DC plans. We have a Retirement CDC in the blocks and preparing to be legislated for and regulated by mid 2029. We may have opportunities to join CDC schemes beyond that (making CDC a retail option).

Herein lies the problem with our regulation. It relies on a distinction between retail retirement saving (with the FCA) and institutional pensions with TPR. The two meet uneasily in the GPP workplace pension. It is an uneasy product that is partially regulated by TPR’s Auto Enrolment team and partly by the FCA with the help of IGCs. We need to recognise that when you have two DC regulators working on the same product, things do not go too well. May GPPs and GSIPPs be a warning for Government and Pensions industry, we are not getting a single DC savings regulator soon. It is a product that hasn’t made up its mind if it is retail or institutional.