The Pensions Regulator (TPR) announced new plans to help UK trustees deal with the valuation and recovery plan process on 17 January

Executivedirector for DB regulation Stephen Soper told pension schemes trustees who attended an NAPF trustee conference in Glasgow that TPR would issue guidance in April to help schemes with their valuation and recovery plan process.

Acknowledging the scale of the economic pressures that trustees and their sponsoring companies are under, he also said that the watchdog would keep publishing a statement on its stance annually.

"During the past four years of economic turbulence, the scheme specific funding regime has provided the flexibility necessary to support sponsoring employers and trustees to find appropriate funding arrangements that protect the scheme – as well as being affordable and reasonable for the employer," said Soper.

He also said that by publishing a timely annual guide, TPR hoped to be able to lower the number of schemes that it would have to challenge or further scrutinise over its valuations.

The announcement comes at a particularly difficult time with pension schemes could be looking at dealing with another set of quantitative easing (QE) measures, coupled with an already very weak sovereign bond market and ongoing turmoil on the stock market.

On 12 January, The Bank of England's Monetary Policy Committee voted to continue its Quantitative Easing (QE) programme which will take until early February to complete and pump £275bn into the UK economy. This has alerted commentators who believe that the Bank will purchase a further £75bn worth of assets as soon as the current round of buying is over.

Weak economic growth prospects for 2012 have added to the suspicion that further QE will be needed.

Darren Phillip, the NAPF's director of policy said that the pensions body welcomed the guidance as it was clearly "more urgent than ever" that schemes get additional help.

"We hope that its guidance will go far enough in helping trustees deal effectively with the serious challenges that pension schemes are facing.

"And with the possibility of more QE ahead, things could get even more difficult for pension funds. Inadequate action from the Regulator will push more final salary schemes towards closure."

The NAPF has urged the regulator to offer more help to struggling funds with measures such as extending recovery periods, smoothing valuation results, and postponing valuation dates.

The CBI's head of pensions policy, Jim Bligh, said: "It is good to hear the regulator making clear to trustees ahead of negotiations that affordability to employers needs to be central to funding defined benefit pensions."

The UK's business representative also commented that "the best form of protection for scheme members' benefits is having the backing of a solvent employer".

Later this year, TPR also intends to set out its strategic view on how it will regulate the DB landscape in the future.

"We have already indicated a more segmented approach to regulation, where we would take a greater interest in schemes that fall into more risky segments - such as those schemes with a very weak employer covenant," said Soper. "In contrast we would expect to have less intensive interaction with those better funded schemes with stronger employer support."

"We recognise the demands on [the trustees] and the level of understanding [trustees] need are extensive. Current economic conditions are adding to those pressures."

Soper acknowledged that trustees "are the first line of defence for 12 million DB memberships – a huge part of the overall landscape". He said that TPR was sensitive to these difficulties, but also had a duty to make sure that high standards were being met.

azeevalkink@wilmington.co.uk