Pensions Regulator limits urgent COVID-19 actions to three months

What you need to know

  • The Pensions Regulator (TPR) has issued further guidance on its dedicated COVID-19 web page.
  • This includes guidance for:
    - trustees on defined benefit (DB) scheme funding, investment and transfer values;
    - employers on keeping trustees informed on their business, especially if reducing contributions; and
    - trustees of defined contribution (DC) schemes on investments and protecting and communicating with members.
  • The new (and previous) guidance can be found here:
  • TPR states the aim of the guidance is to help trustees manage the issues that have arisen due to the COVID-19 outbreak and supports them in making difficult decisions during this time. However, it does not supersede trustees’ fiduciary duties, scheme rules and legislation. TPR will, however, not take action and its regulatory easements will remain in place until 30 June 2020.
  • Urgent actions covered in response to COVID-19 include reducing contributions, stopping transfer value payments and delaying funding valuations. In the absence of a full analysis these actions should be limited to three months and kept under review.

Actions you must take

  • Read the additional guidance on TPR’s website.
  • Decide on approach for valuations currently underway – should they be submitted or delayed?
  • Follow TPR’s guidance if suspending contributions – maximum suspension of three months after limited analysis.
  • Review member options – decide whether suspending transfer values is warranted.
  • Communicate with and protect members – in light of heightened scam risks.
  • Review DC investment risks – and take action to support and protect members.

High level TPR guidance on key issues


The finer detail: Summary of TPR’s additional COVID-19 guidance

Additional guidance provided on 27 March

TPR sets out further guidance on DB funding, transfer values and investments and DC investments. It sets out how it will regulate for the next three months noting that its guidance does not override scheme rules and legislation.

Defined benefit pension funding

Current valuations

There is no need to revisit assumptions or allow for post-valuation experience (other than employer contribution affordability) for valuations currently being finalised. Trustees can, however, delay submission by three months if they need to review.

Employer contributions (including future service)

Can suspend for a limited time (at most three months) without full information and analysis in line with guidance. TPR does not expect recovery plans to be extended as a result. Trustees should be cautious if delaying a large or annual payment, ensuring employer makes no payments to shareholders and only necessary intra-group payments are made. Check scheme rule requirements for future service payments.

Defined benefit investments

Scheme cashflow

Review scheme cashflow needs in light of changes to member needs, contributions, investment income and investment cash calls (e.g. under hedging agreements).

Emerging risks

Manage risks that now exist, such as credit risk in the portfolio or changes to employer strength, meaning risks are concentrated or the strategy is too high risk.

Past decisions

Review past decisions currently being implemented to see if still appropriate.

Guidance for employers

Recognition of current challenges

TPR recognises the strain employers face. TPR will be proportionate and aims to help employers get back on track. It directs employers to business support information published by the Government. Further guidance on corporate distress is also provided.


Assess if changes are needed to the investment and risk management framework. Review governance structures and delegations to ensure they remain effective.

Transfer values and other member options


Trustees may suspend transfer quotes and payments for up to three months, in order to review terms and administrative impact, without TPR taking action. Any longer suspension will need to be justified. Other options such as cash commutation may also need to be reviewed.


Communicate with members on actions the trustees are taking. Be aware of and give attention to the heightened risk of scams.

Defined contribution investments


Members’ pots will be affected by the current market. Members’ own personal position may cause them to take action such as opting out or locking in losses. Trustees should review communications and be aware of scams.

Trustee actions

TPR sets out actions including managing emerging risks, reviewing decisions being implemented and ensuring trustee’s governance structure is effective, For more on DC risks please read our briefing: for-dc-schemes/.

For further information, please get in touch with Wayne Segers or speak to your usual XPS contact.

Back to top