Chris Connelly, Propositions and Solutions Director at Equiniti
A new joint Equiniti and PASA white paper, ‘Spanner in the works’, and supporting research, have uncovered a significant mismatch between pension schemes’ understanding of their position on scheme data and their efforts to improve its quality.
Our research showed that many schemes have begun projects to drive up data quality, but among the rest, the survey found considerable gaps in both knowledge and execution.
Technology can’t run efficiently without good data and high quality data is the foundation of good pension scheme governance. Without it, any tech implementations will fail to deliver the anticipated results. As a result, some of the ambitious plans shared by these schemes amount to little more than wishful thinking, as they are doomed to failure.
Schemes want technology, but do they know why?
There is a high demand for technology to be deployed, with the greatest demand from DB schemes. This is focused largely on systems to support general administration, covering self-service calculations (34%), benefit statements (29%), payslips (28%), pensions dashboard (22%) and educational content (21%).
They see the greatest impact upon the pension function coming from:
- improved member experience;
- reduction in administration costs; and
- increase in member engagement.
Hybrid and DC schemes scored the benefits of these technology solutions far lower than DB, suggesting technology is to be used under sufferance – or where practical as per the question – rather than as a core response to processing data.
There’s a lack of awareness of what these innovations would actually deliver to a scheme – and its members. Even among schemes that know their data is not good, it is either a) not a priority or b) there isn’t any budget for it at the moment.
Many schemes have an outdated perception of their membership and pensioners in general. Schemes seem to rely on preconceptions of their members’ wishes and IT capabilities. Though many (in particular, DB) schemes believe technology will improve member experience and engagement, only 12% have actually polled their members to understand how members believe technology would prove beneficial to them.
Interacting with members is not only useful to understand how a scheme might improve its processes, but essential if seeking to introduce innovations that can greatly improve the running of the scheme.
