UK pensions headlines: August 2023

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• Pensions Regulator updates DC Code and guidance on illiquid investments

Pensions Regulator updates DC Code and guidance on illiquid investments

Mark Dowsey, Janine Bennett | August 30, 2023

TPR has updated its DC Code of Practice No. 13 and accompanying guidance to help schemes comply with the new disclosure requirements on illiquid investments.

Under amending regulations and statutory guidance published earlier in 2023, trustees must state, in the Statement of Investment Principles (SIP) for their scheme’s default arrangements, their policy on investing in illiquid assets from the earlier of:

• The first time the ‘default SIP’ is revised after 1 October 2023, and
• 1 October 2024.

In addition, from the first scheme year ending after 1 October 2023, the annual governance (or chair’s) statement must disclose the asset allocation for each of the scheme’s default arrangements. The asset classes are:

i. cash
ii. bonds (corporate and Government – both UK and otherwise)
iii. shares (listed on a recognised stock exchange)
iv. shares (not listed on a recognised stock exchange)
v. infrastructure (eg public facilities, systems and networks including gas, electricity, roads, schools and hospitals)
vi. property (other than in v.)
vii. debt instruments (other than ii.)
viii. any other assets.

TPR’s DC Code of Practice and accompanying guidance on investment governance and communicating and reporting have been updated to reflect the above.

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