New DB funding code gets provisional September 2023 operational date

The Pensions Regulator has confirmed that it expects the long-awaited DB funding code to be operational from September 2023. The new code will be forward-looking, affecting schemes with valuation effective dates on or after its commencement date.

In its corporate plan for 2022 – 2024, the Regulator explains that it plans to launch a second consultation on the code in autumn 2022. However, this is on the basis that the DWP first holds its own consultation on draft funding and investment regulations in spring 2022.

It is also possible that the Regulator will undertake a regulatory initiative focusing on scheme management of risk and resulting covenant strength before the code becomes operational.

The Regulator cited the need to “develop the right shape” for the code to explain the previous delays to the second consultation – the timings in the corporate plan are themselves subject to change and it remains to be seen whether there will be any further lengthening of the timetable.