The UK pensions industry, already being investigated by several financial luminaries, is to face a fresh review under the scrutiny of the former chief executive of the Nationwide building society, Brian Davis.
The inquiry is to focus on the role of the Occupational Pensions Regulatory Authority (Opra). It stems from the Government's routine policy of reviewing non-departmental bodies every five years.
This "quinquennial" inquiry comes as Ron Sandler, the former chief executive of Lloyd's of London, readies his report into the retail long-term savings industry, and just eight months after a crackdown on pensions red-tape was launched by Alan Pickering, the former chairman of the National Association of Pension Funds and a partner at the actuary Watson Wyatt. Meanwhile, the City is still adjusting to the report on institutional investment produced more than 15 months ago by Paul Myners.
A major part of Mr Davis' work would be establishing whether Opra is too prescriptive in the way it oversees occupational pensions. The regulator was created in 1997 by the Pensions Act of 1995, which was passed in the wake of the Maxwell affair.
"Perhaps Opra should be more about ensuring compliance with regulations rather than punishing non-compliance," one source close to the investigation said.
Among possible recommendations could be a greater emphasis on educating pension fund trustees to give them greater expertise in their role. Mr Davis is due to complete the first stage of his consultation in August, with a view to publishing his report by the year-end.
While the Department for Work and Pensions scouted around the City for candidates, Mr Davis was said to have been chosen for his "clear eye" and lack of vested interests.
Ian McCartney, the Pensions minister, said: "The review will ensure that the services currently provided by Opra are delivered in a way that best meets the needs of those it serves and that it is managed in the most effective way."
Mr Sandler's forthcoming review aims to establish whether insurance-based and unit trust savings products offer value for money for consumers. It was launched on the recommendation of Mr Myners, who criticised the City for failing to offer a transparent service to occupational pension funds.
In September, the Government asked Mr Pickering to see whether red-tape, such as curbs on money laundering, was slowing the take-up of personal pensions. He said existing legislation seemed to be counterproductive, discouraging employees and the self-employed from using them.Reuse content