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Statement of strategy consultation

Statement of strategy consultation

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Volume 2024 | Issue 05

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The Pensions Regulator is consulting on the form of the statement of strategy that will be required for valuations under the new funding regime from 22 September 2024.

Responses to the consultation, which runs to 16 April 2024, may influence the finalisation of the funding code this summer.


The Pension Schemes Act 2021 introduced requirements that trustees determine a funding and investment strategy (FIS) for ensuring that benefits can be provided over the long term and prepare a written statement of that strategy.

The content of the statement of strategy is set out in the forthcoming Occupational Pension Schemes (Funding and Investment Strategy and Amendment) Regulations 2024 (the ‘FIS Regulations’), which will also require that the statement be in a form set out by the Regulator. In most cases, this would be prepared alongside the triennial valuation.

What is the Regulator proposing?

The Regulator proposes to standardise statements of strategy through use of pre-defined templates, depending on whether the valuation is submitted under the Fast Track or Bespoke routes and whether the scheme has reached significant maturity (strictly, the ‘relevant date’ per the FIS Regulations).

The four proposed templates

·       Fast Track before the relevant date

·       Fast Track on or after the relevant date

·       Bespoke before the relevant date

·       Bespoke on or after the relevant date


The statement would be generated from answers to questions with a mix of drop-down options, numerical fields and free text. For example, trustees would select their long-term objective from a choice of buy-out, run off, superfund, alternative consolidator or other (with free text to expand).

It appears that responses to certain questions (for example, whether the scheme is open to future accrual) will lead to other specific questions being asked. Most questions would be mandatory, with optional additional narrative on a small number of points.

How the statement of strategy will be used

The statement of strategy aims to be a useful risk management tool, facilitating engagement between trustees and employers and focusing attention on areas to be managed.

The Regulator will receive more data upfront than currently, and intends to develop a more data-led approach to regulation. While there will be some overlap between information in the actuarial valuation, statement of strategy and scheme return, the Regulator is looking at ways to streamline data collection and remove unnecessary duplication.

Fast Track v Bespoke

The December 2022 consultation on the funding code, and the Regulator’s regulatory approach, set out proposed Fast Track parameters representing a tolerated level of risk in the funding and investment strategy. Schemes not meeting these parameters would submit valuations under the alternative Bespoke route.

The questions on the funding and investment strategy would be substantially the same for both routes. Schemes using Bespoke would provide additional supplementary information, particularly on investment risk and covenant (including data on the employer’s cash flow and calculations of maximum affordable contributions).

Smaller schemes

Information requirements will be adjusted for smaller schemes using two measures. Schemes with fewer than 100 members will have exemptions on some actuarial data (e.g. benefit cash flows) and schemes with less than £30 million in PPF Section 179 liabilities will provide less information on investments.


In principle, we welcome the Regulator’s proposal to standardise statements of strategy by issuing templates. These will need to be rigorously tested before schemes first need to use them in 2025.

The consultation is another sign of the direction of travel of the new funding regime. It provides an opportunity for trustees, employers and others to influence the Regulator’s thinking as it finalises the funding code and develops new covenant guidance for publication in the summer.