EQ Mccloud

McCloud – Understanding Your Problem Domain

01 December 2020

Andrew Lowe, Change and Solutions Director, EQ Paymaster

If admitting you have a problem is the first part of the solution, then understanding the dimensions of the problem should surely come next.

Andrew Lowe 800X600px Andrew Lowe Change and Solutions Director, EQ Paymaster

As the entire public sector continues to wait on the outcome of the various consultations on the McCloud issue, the remedy implementation date of 1 April 2022 inches ever closer. It has been suggested that legislation on the issue could be delayed due to a crowded political agenda. COVID-19 and Brexit may take precedence here but how do we protect our members and schemes from being backed into a corner?

With less than 500 days to go until the end of the proposed remedy period, it’s key that we take action now. We introduce this short series of articles to outline exactly what those actions should be. 

Understanding the problem domain – Know your population

The most important thing before doing any planning is to know your population inside out. Analysing your population can highlight key areas of concern and focus for your overall McCloud solution.

It’s easy to get sucked into: data collection, communication planning, and bolstering your team for remedial activities, but if you don’t know where to focus, effort may be wasted.

What to look for?

The specifics of each public sector scheme are slightly different – be it the LGPS underpin, the significant NRA changes in the blue light arena, or large accrual changes in the Civil Service – but there are still effective ways to break down your population.

Key focuses should be items such as:

  • Impacted population – Who meets the criteria of those impacted by the judgment.
  • Immediate detriment – Which members have already lost out – should they be targeted first?
  • Likelihood of change – It’s relatively simple to model the key factors (salary growth, service, age) that create benefit inflection points at an individual level.
  • Member choices – Many members follow similar and simple paths to retirement, but a significant proportion have had transfers, divorces, commutation or paid AVCs in one form or another.
  • Taxation – Which members are at or near tax thresholds?

We may not yet know exactly how each of these complexities will need to be tackled, but in knowing the scale of each individual problem, this will help us plan the route forward.

What next?

Planning. Knowing the size, shape and complexity of the population will allow the creation of on an effective project plan. This will also help you understand resource and budgeting needs. It means that any data analysis and communications can be targeted to get maximum value for your efforts. We will go into more depth on this subject in our next article.

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