Dalriada News

Greig McGuinness

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Understanding your covenant

The Pensions Regulator recently released a handy 66 page guide on “Assessing and monitoring the employer covenant” for defined benefit schemes. As a professional trustee I have obviously read it cover to cover but you may want to start with page six, the “At a glance” summary.

The guidance is aimed at trustees and advisers but it would be sensible to make sure that sponsoring employers see it too; it never hurts when asking probing questions or looking for additional adviser budget to point to a bit of guidance and blame the Regulator – in this case “he made me do it” is an acceptable excuse. The Regulator has suggested that all trustees should at least read pages 6 through 8. From a knowledge and understanding point of view, I think all trustees should at least scan all 66 pages – there are some useful pointers and examples in there – but they should completely familiarise themselves with the “At a glance” summary. (more…)