I declare an interest here, my background is administration. A long time ago, in a company that became Mercers took a punt on a twenty something with no pensions experience and trained him up. From this, I made my living from making sure that the right person is paid the right benefit at the right time.
Which is why I can’t believe I’m the only person to feel disappointed that our friends in Brighton have to continually bang on about the importance of trustees (and by default their administrators) keeping decent quality member and scheme records. Quite apart from the usual reasons to keep quality records – that would be paying the right person is paid the right benefit at the right time – there are a number of other reasons why this is critical to the health of the scheme. Here are some to ponder:
- The scheme valuation is built around the member data, double counting member Guaranteed Minimum Pension (GMP’s) does have a negative effect on the scheme liabilities to name but one error we have seen. The point is that the work done around scheme common and conditional data should be making a positive impact on the accuracy of the scheme liabilities
- Scheme de-risking exercises can be seriously de-railed by incorrect member data, affecting the potential return gained by the employer on the scheme liabilities and requiring more work around the investments to more closely match the benefits they are there to fun
- The end of contracting out from April 2016 mean that there is a rapidly decreasing amount of time available (and as importantly, resource at HMRC) to sort out the number of data queries which have and will continue to arise. The important point to note is that the HMRC works on the principle of ‘we are right and the scheme is wrong’. Disproving the often significant differences takes time, energy and commitment to see it through to the end
- Although the government appears to have moved automatic transfers of small benefits down it’s ‘to do’ list, records have to be accurate in order that the right benefits (that phrase again) are passed onto the receiving scheme. The thought of rectifying past errors where records are a dim and distant memory (think GMP’s) should be enough to send shivers down trustees spines
- And not least, the pension flexibilities which are now in force now demand that member data is accurate and accessible
If you think that having a no obligation chat with Trustees who understand the importance of scheme data would be a good use of time, then look at our case studies and contact us 0845 4334 199 or email email@example.com