“There is a perfect storm of government initiatives going on at the moment which are coming together and making the environment in the pension marketplace in need of some dramatic changes.”
This autumn employee benefit and pension departments will face their biggest challenge in a decade: auto-enrolment. Employee benefit specialists are in the midst of an administrative minefield that, with the 2013 introduction of Real Time Information (RTI), could reap further havoc if managed incorrectly.
Only with the latest updates, platforms, data cleansing and IT infrastructures will pension professionals succeed in coping with this dramatic surge in membership. Without such, organisations will be unable to deliver an efficient, compliant and effective plan and deficiency in their reporting capabilities will result in the regulators’ wrath.
The Data and Technology for Employee Benefits report, published 1st October 2012, by Clear Path Analysis, explores how best to harness the latest tools and processes in the first phase of auto-enrolment for maximum operational efficiency. The report uncovers innovative communication strategies to ensure that both employer and employee fulfil their obligations in an era where Defined Contribution schemes are taking precedence.
Upgrading data management systems are crucial to operational success, and as James Markham, Managing Director, SBC Systems UK, highlights; “You need to know the volume of data that needs to be analysed and in many cases this will significantly increase. The deadlines imposed place another challenge on the data as it the turnaround can no longer be months in duration. There has been an entire new concept added whereby the industry has to track people who are not even customers {..}”.
Despite the challenges that auto-enrolment is unwillingly bringing, with the right platform, Markham demonstrates that there is opportunity to be had; “This [government initiative] perfect storm catalysed by pensions auto-enrolment, supplemented by the real time information (RTI) initiative from HMRC and boosted by the retail distribution review on industry margins presents a huge opportunity for us to bring more value into the pension industry.”
In the current digital age online platforms can add crucial value to a member communication and scheme efficiency. As Nick Wheeler, Chairman of the Trustees, Volvo Group UK Pension Scheme, demonstrates; “With auto-enrolment there is a shift in the balance of power for pension matters with more day-to-day responsibility passing to the employer. Online facilities will have a big role to play both in cutting costs and in improving overall performance.”
Yet the latest technologies will only be beneficial if pension plans and HR professionals utilise them correctly. Jerry Gandhi, Chief Operating Officer, NOW Pensions, stresses the importance of technology and communication and the rise of online portals; “80% of the UK population has easy access to online information {..} This means the best way of connecting to the public in a wider sense is using this technology but doing so in “bite size” chunks. They need to be able to digest information, understand it and action it quickly. If you issue lengthy documents that require careful reading the tendency, particularly for the younger “instant gratification” generation, is to ignore it or to file it for later action which generally means never.”
About Clear Path Analysis
Clear Path Analysis is an impartial, independent publisher of high quality reports on pressing industry issues written by a cross-section of experts in the financial services, investments and pensions sector. Clear Path Analysis has a unique position in the market place- because of its model of using majority end users and buyers to contribute to high quality papers. Clear Path Analysis, established by Noel Hillmann in January 2010, is headquartered in London and has plans to expand into New York over the next two years, substantially growing its headcount. For further information, please visit www.clearpathanalysis.com
