A data with destiny

Even in this technological age, many schemes do not have full digital records, nor do many members have access to a pensions web portal, yet we expect to be able to game, shop and bank online.

Everything these days is at the click of a button. And behind each click is a phenomenal amount of data.

The most basic fiduciary duty of any trustee is to hold accurate data. But can all trustees say that they and their administrators hold accurate, usable digital data? Is it still on paper, microfiche (still? seriously?), or a spreadsheet? 

We have simply never approached this in a holistic joined-up sense, and data has been seen as a dirty word. But that is just not good enough anymore

Data is like garbage

The recent fining of the Weir Group Pension and Retirement Savings Scheme and its previous administrator over the poor handling of a member’s transfer value information shows how difficult it can be to maintain accurate records for members when schemes have been transferred from administrator to administrator.

We talk about data in so many different contexts, such as the Pensions Regulator’s data-keeping requirements, member data transitions to new administrators and accurate data for online member portals. 

Poor and badly kept data has always been a key issue facing the industry, and there can be a perception that pensions administration is unprofitable, resulting in underinvestment in data quality, automation and resourcing. 

In turn, this causes errors and therefore stress for the member (and administrators) and the potential huge costs of dealing with a complaint.

Mark Twain apparently once said, “Data is like garbage. You’d better know what you are going to do with it before you collect it.” 

Of course, we have always needed data to calculate members’ benefits, but we have not always had a clear plan to ensure it was complete and fit for purpose.

It seems we have simply never approached this in a holistic joined-up sense, and data has been seen as a dirty word. But that is just not good enough anymore. And now we have a focus in the dashboard.

These risks can be boiled down to the issue of member data

This project will hinge not just on whether administrators can physically deliver accurate data to the dashboard ecosystem, but also that the sheer scale and the scope of the dashboard project brings with it risks and pitfalls. 

Most of these risks can be boiled down to the single issue of member data:

• How that data is stored and maintained — it will be a huge challenge for the pensions industry as a whole to ensure the consistency of this data in terms of its maintenance and supply so that information from across multiple sources can be presented to the member in a unified manner, thus aiding meaningful comparison.

• How that data is accessed — the member and benefit ‘matching’ process will require members’ personal information to be sent to multiple databases in search of a match on their pension information. This poses security challenges, and questions on how long that search data can be stored by each of the recipients cannot be underestimated.

We have now had long enough to fill the gaps. Maybe it is us who should be thanking the architects of the dashboard project to get our own houses in order.  

Of course, better data can bring other positives for members in terms of turnaround times for benefit information, better online access via schemes’ current web-based portals, swifter tracing of members and most importantly, the issue of 100 per cent accurate benefit quotations.

Perhaps, therefore, the pensions dashboard is not just about what the general public requires in order for them to make sense of their pension savings and to proactively engage. It is also the wake-up call that the pensions industry was crying out for. 

A deadline. A line in the sand to force trustees and administrators to get to grips with their scheme data once and for all. Maybe we will, perhaps a little belatedly, join the digital revolution.

Jemma Jurgenson is head of administration at Quantum Advisory.