The Pensions Regulator has published details of its funding investigation into the Docklands Light Railway (DLR) Pension Scheme.

The report highlights how it will take action to protect member savings where defined benefit schemes have missed statutory deadlines to provide valuations.

The trustees of the scheme and its employer, Serco Limited, were unable to reach agreement on the actual valuation with an effective date of 1 April 2009.

Initially, the regulator says, it facilitated discussion between the trustees and Serco but negotiations were unsuccessful.

There were further negotiations, which led to an agreement being reached, but the new settlement showed a funding deficit.

The scheme's funding deficit shown in the 1 April actuarial valuation (GBP 36.1million) will be cleared by January 2018 with more than GBP 20million payable by January 2016.

In total, there was an agreement to pay GBP 37million to the scheme with GBP 33million coming from Serco Limited and £4million coming from DLR Limited.

Lesley Titcomb, chief executive at The Pensions Regulator, said: "Our action demonstrates that we will work closely with schemes to address non-compliance and we have low tolerance for late actuarial valuations."

"As late actuarial valuations can create uncertainty and could increase risks to both the scheme and the employer, we will consider whether to use our powers to protect member outcomes and ensure employers meet their obligations."

Nick Griggs, a partner at independent consultant Barnett Waddingham, said the late valuation should not be the norm.

He said: "While the Pensions Regulator is willing to put its powers on hold to enable trustees of a well-governed scheme to reach an agreement with the sponsoring employer, late valuations should be the exception rather than the rule."

"We expect that in the current challenging conditions, and while trustees are getting to grips with the Regulator's new guidance on scheme funding and monitoring the employer covenant, trustees and employers may face protracted negotiations regarding funding."

First published 10.09.2015

Lindsay.sharman@wilmingtonplc.com