The UK's pension watchdog today delivered on its promise to bare its teeth by issuing its first ever fine to a public sector pension scheme.
The Pensions Regulator (TPR) slapped the London Borough of Barnet with a £1,000 penalty for failing to submit its 2016 scheme return.
TPR has been vocal in recent months over plans to get tough on pension scheme failings. It has promised to "intervene" where companies are treating schemes unfairly.
Meanwhile, the government is consulting on plans to give TPR proactive, rather than reactive, powers to step in to prevent BHS-style corporate failings following large pension shortfalls.
TPR issued Barnet council with a notice to file its return on 9 July 2016, setting a deadline of 12 August. The North London borough failed to file the return and respond to the correspondence. This led to the matter being referred to TPR’s Determinations Panel on 24 February 2017.
“It is the legal responsibility of trustees and managers to submit a scheme return by the deadline," said TPR executive director of frontline regulation Nicola Parish.
"This is one of the most basic regulatory requirements for trustees and managers and it is vitally important that we have up-to-date information about schemes so we can carry out our role effectively. We are also concerned if it is not submitted, as this may signal further problems within the administration of the scheme. Good scheme governance is a key factor in achieving positive outcomes for members. The action we took in this case demonstrates our commitment to this.
We have shown that where managers and trustees are failing with their basic duties, including in large public service schemes such as this one, we will use our powers to intervene.
A penalty notice was issued to London Borough of Barnet, as scheme manager, on 13 April and paid on 9 June.
A Barnet Council spokesperson said: “The council recognises that this is totally unacceptable. Due to a specific resourcing issue, the 2016 annual scheme return was not filed in time by our supplier. The fine has been paid by them and steps taken to ensure this will not reoccur.”