The corrupt directors who play fast and loose with the pension scheme of their company could face some jail time and limitless fines under the new measures that were presented by the government last Tuesday.
Last Tuesday, a consultation was initiated by Guy Opperman, the minister for pensions and financial inclusion, which is set to impose harsher penalties for the directors who recklessly or deliberately place company funds at risk.
Once passed, the said measures will provide the Pensions Regulator (TPR) more power to meddle when firms make decisions that could damage the defined benefit (DB) pension schemes.
The government disclosed that even though the system worked well and the majority of the company managers followed the rules to provide their members with a pension, some areas still need improvement.
Opperman stated: “The government’s position on defined benefit pensions is clear: Where an employer can, they must continue to meet their responsibilities.”
He added: “Millions of people across the country rely on defined benefit pension schemes to support them during their retirement.
“That’s why we are committed to introducing a range of new measures which support the Pensions Regulator to be clearer, quicker and tougher.”
The minister continued: “This is an opportunity to strengthen defined benefit pensions’ protection for the long term, and it is extremely important we get the changes right.”
The said consultation is scheduled to run until the 21st of August. It arrives after the recent news that the Pensions Regulator said that it was considering an issuance of a “contribution notice” which could urge the former directors of Carillion to directly pay back the remainder of the pension liabilities of the collapsed company.
Other well-known pension collapses include the demise of BHS and Philip Green, its former boss, who was forced to fork out £363m in cash last year to rescue the scheme of the company after it was thrown into doubt when he sold the firm for £1 to Dominic Chappell, a former bankrupt.