The Pensions Regulator: a prudential approach to enforcement?

In recognition of the evolving pensions landscape, on 16 September 2025, the Pensions Regulator (TPR) issued a consultation regarding the proposed changes to its enforcement strategy (the Consultation). The Consultation contains 10 questions tailored around TPR's new proposed strategy and welcomes responses by 11 November 2025. The developments will be of interest to PTL insurers in particular.

 TPR's current powers 

TPR has a broad range of enforcement powers which can be imposed on companies and connected individuals involved in the management of occupational pension schemes. Broadly, these powers can be divided into four categories: 

1. Regulatory Powers: TPR can issue statutory notices requiring parties to take (or refrain from taking) certain actions.  

2. Penalty Powers: TPR has powers to impose financial penalties on employers or connected companies. In most cases, the maximum penalty for each breach is up to £5,000 for individuals and £50,000 in other cases. However, in limited circumstances, TPR can impose fines of up to £1 million.  

3. Criminal Powers: TPR has the power to prosecute companies and connected individuals for the most serious behaviour.  This can include contravention of the restrictions on employer-related investments or providing false/misleading information to TPR, for example.

4. Civil Powers: In the civil courts, TPR can pursue injunctions to prevent persons from misusing or misappropriating scheme assets. TPR can also seek restitution of scheme assets to restore those affected to the position they were in before the assets were misused or misappropriated. 

TPR's Consultation  

The Consultation does not propose any amendments to TPR's powers.  Instead, it introduces some broad changes to its approach to governance which, it suggests, will make enforcement smarter, more strategic and impactful. These changes are summarised as below:

1. Putting saver outcomes first: There will be an increased focus on delivering real-world outcomes to individuals, such as harm prevention, securing redress, and building saver confidence, rather than monitoring outputs. 

2. Setting clear enforcement priorities: The greatest risks to savers and the greater pensions system will be prioritised in terms of enforcement action.  

3. Targeted enforcement: There will be a more prudential, proportionate, risk-based approach to enforcement that concentrates on the most serious harms. 

4. Acting earlier to prevent harm: Earlier intervention will be considered to prevent harm from being suffered and avoid escalation. This will involve closer integration between TPR's Enforcement and Market Oversight teams.

5. Working together to solve problems: Cross functional working with external partners and stakeholders will be promoted and encouraged in order to respond more effectively to complex and emerging risks.

6. Building a flexible and skilled team: Staff will be trained and deployed more flexibly across different cases to create a more resilient and adaptable workforce. 

7. Using data to make smarter decisions: Digital tools will be used to spot trends and track results which will support a smarter, evidence-based enforcement system. 

8. Being open: Greater transparency will be encouraged by publishing enforcement outcomes and communicating expectations in a more efficient manner with the aim of building trust, and drive behavioural change and improve accountability across the industry. 

Implications of the Consultation 

The purpose of the Consultation is to create a more focused, agile, and outcomes-driven enforcement model aligned with TPR's statutory objectives and corporate priorities, with a shift towards a more prudential style of regulation. 

However, the proposals outlined in the Consultation are predictable and come across as vague. Given the impending Pension Schemes Bill, which is set to introduce radical reforms to the UK pensions system, it could be said that TPR has missed an opportunity to align its enforcement model with the changes set to be implemented soon.

That being said, the shift in focus to a risk-based system may result in greater focus on emerging issues and put greater emphasis on schemes to conduct investigations into potential issues so as to avoid escalation.  In a similar vein, TPR’s aim to become more agile could result in the earlier use of enforcement powers.  The evolution of TPR's enforcement policy is something PTL insurers offering regulatory costs cover will want to monitor.

Responses to the Consultation must be submitted by 11 November 2025 and it may be that TPR further develops its enforcement proposals following feedback from the industry. It intends to publish its final enforcement strategy and consultation responses in early 2026.