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Andrew Warwick-Thompson, executive director for regulatory policy at TPR, said: “Pension schemes plan and invest for the longer term, and our message to trustees is not to over-react to the current volatility. We will provide support and clear direction to trustees and other parties to help them through the uncertainty ahead.”
In its guidance statement, the regulator set out to trustees of DB and defined contribution (DC) schemes a series of messages and key areas for action in light of the vote. “Our key message to trustees and sponsors of occupational schemes is to remain vigilant and review their circumstances but continue to take a considered approach to action with a focus on the longer term,” the statement says. “It is too early to understand or assess the full consequences of the outcome of the EU referendum in detail. However, we expect trustees to have an open and collaborative discussion with their sponsor about the possible effects to their business.”
Warwick-Thompson said contingency planning was an integral part of the effective stewardship of pension schemes. “We expect trustees to review their plans and how they interact with current circumstances on a regular basis,” he said.
At this point, the regulator expects trustees of DB schemes to review their employer covenant to understand how Brexit could affect it, he said, adding that they should also consider how market volatility has affected scheme funding.
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