With the aim of raising standards of governance and administration in defined contribution (DC) schemes, the UK Pensions Regulator has publishing a draft revised code of practice for consultation.
The new draft DC code is shorter and simpler, and sets out the standards of conduct and practice the regulator expects trustee boards to meet in complying with their legal duties, and to deliver better long term outcomes for retirement savers.
The new code will overhaul the existing DC code first published in 2013 to better support trustee boards and managers of schemes offering money purchase benefits as they adapt to major reforms introduced earlier this year.
The draft DC code includes a section which specifies what is required when it comes to business continuity. It reads as follows:
“We expect trustee boards to ensure that they have an adequate business continuity plan and that this is reviewed at least annually, and tested as appropriate. The complexity of this plan will dependon the size and complexity of the administration operation, but weexpect it to cover:
- loss of key personnel
- business disaster recovery
- safeguarding of data
- how to continue to process core financial transactions.
“Where a third party administrator is used, trustee boards will need to understand the business continuity arrangements that the service provider has in place, and be confident that it adequately mitigates any risks to member data and benefits.”
The consultation will run until the end of January 2016 before the DC code is laid in Parliament next May, and comes into force in July. The 2013 code remains in force until then.More details.