Jane Kola’s comments from PMI’s “Getting ready for the end game: Where next for data?” Roundtable published in Professional Pensions
According to PMI roundtable ‘Getting ready for the end game: Where next for data?’, trustee boards are not focusing enough on data issues despite the bad effect poor data can have on members.
Despite the lack of focus in the data issues of schemes, The Pensions Regulator says it is gradually “improving.”
Jane Kola commented that some schemes have “bigger problems than others” in terms of data and the consolidation and cleaning of it.
She added that while “data is one side of the coin, rules are the other”, stating we must not forget the law is a key issue when dealing with individuals’ data, especially since the introduction of the General Data Protection Regulation last (GDPR) in May last year.
Trustees need to do more to get their data in order and have a legally signed off understanding of member entitlements under the scheme rules.
Jane also noted there are times when missing data is not possible to recover and sometimes there is “no choice but to make assumptions if there is missing data”, adding that these kinds of assumptions “lead to risks.”
Furthermore, she stated that “all schemes have an issue somewhere” but noted they do not necessarily know how to fix them due to the fact they “don’t know where” the issues are. Jane noted that the answers to data issues are all there if a person knows where to look.
The roundtable also discussed one of the biggest tasks for defined benefit schemes: guaranteed minimum pension (GMP) equalisation.
Jane suggested schemes need to get started with the process of equalisation and noted once the data is found and the equalisation process is complete, “there is not much left to sort out after. We’ve kicked the GMP can down the road for 28 years; let’s not kick the can any further.”
People are entitled to the correct benefits in retirement and are entitled to what they were promised, as Jane stated, and the process needs to get started to ensure members are paid what they are owed.
Jane concluded that trustees need to be “realistic” about the process of cleaning data, so schemes can hopefully begin to address their data challenges.
Read Jane’s comments in Professional Pensions here.
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