Schedule 10: Interest on late payment of levies Section 131: Appointment of trustees
441.Section 7 of the PA 1995 allows the Pensions Regulator to take action to appoint trustees where it is satisfied that this is necessary and only in certain specific circumstances. Where appropriate these trustees can be independent, that is, professional trustees that are fully independent of the employer or any other interest in the scheme. Examples of the circumstances in which this can be done are if the Regulator is of the opinion that the existing trustees of a scheme do not have the necessary knowledge for proper administration or if there isn’t a sufficient number of trustees.
442.The section extends this power to allow the Pensions Regulator to appoint trustees in certain circumstances where it is reasonable to do so, instead of necessary. The “necessary test” means that the Regulator may only appoint a trustee if it is satisfied that there is no other option available and it must act almost as a last resort. A “reasonable test” would enable the Regulator to appoint a trustee where there are a range of options available but the appointment is the most appropriate action for the scheme.
443.It also amends section 7(3) of the PA 1995 to extend the circumstances in which this power may be exercised, to enable the Regulator to appoint trustees in order to protect the interest of the generality of scheme members. It also makes a change consequential on the addition of a further subsection to section 7(3).