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TPR to demand record-keeping measures from schemes

Ref: PN16-53
Wednesday 30 November 2016

The Pensions Regulator (TPR) is to ask trustees to report on record-keeping in their scheme return to help improve standards.

A TPR survey (PDF, 647kb, 37 pages) of more than 530 trust-based occupational schemes, published today, has revealed little recent improvement in record-keeping, essential to deliver value for money and protect member outcomes.

Andrew Warwick-Thompson, Executive Director at TPR, said: “It’s disappointing that we are not seeing more schemes taking their duty to keep proper records more seriously. We’ve made clear what our expectations are and many schemes, across all scheme types, are not meeting them.

“By adding record-keeping measures to the scheme return, we will be able to target our interventions more specifically at those failing in their duties.

“Good record-keeping is essential to the good running of a scheme. The time to engage is now – if you don’t, you run the risk of increased costs, not managing funding or risks properly, and you could even put members’ benefits at risk.

“We know schemes are looking to improve members’ experience and engagement through enhanced use of technology such as offering self-service access or participating in industry-wide initiatives like the Pensions Dashboard. But all this relies on good data, and good data security.”

To help schemes meet their duties, TPR has launched a quick guide to record-keeping (PDF, 146kb, 4 pages) and will be providing further educational products in 2017, including videos and bite-sized learning.

TPR’s 2016 survey shows that:

  • 30% of members are in schemes where conditional data (data used to calculate benefits) is not measured.
  • Larger schemes are significantly more likely to have measured their data – 87% of large schemes had measured common data versus 18% of micro schemes.
  • Administrators’ understanding of the terms 'common data' and 'conditional data' is not universal.
  • Administrators and trustees perceive conditional data as secondary to common data – two fifths (39%) of administrators felt the measurement of conditional data was not a priority for their scheme.
  • Record-keeping is not always seen as a priority by trustees, and they do not engage with their administrators accordingly – a quarter of administrators (23%) felt that trustees treated record-keeping and administration as a low to middling priority (0 to 6 out of 10). This went up to 32% for micro schemes, while trustees of automatic enrolment (AE) schemes were perceived to be more engaged with record-keeping than non-AE trustees.

TPR has made clear that it expects all schemes should measure the presence and accuracy of their data, and put plans in place to resolve issues where they find them. Trustees and managers should be engaging with their administrators to drive this work forward.

Editor's notes

  1. The report summarises the results from the 2016 record-keeping survey conducted by TPR among a sample of 497 scheme administrators, who provided data in relation to 532 occupational, trust-based pension schemes. The survey data was weighted and analysed in two ways: firstly, it was weighted to the membership profile of pension schemes to be representative of the member universe. Secondly it was weighted to the scheme profile to be representative of the scheme universe.
  2. The main aim of the survey was to determine current standards of record-keeping performance and administration, comparing to findings from our previous record-keeping surveys. OMB Research, an independent market research agency, conducted the survey on TPR’s behalf. The survey fieldwork took place between January and March 2016.
  3. The report also includes findings from qualitative research conducted with scheme trustees and administrators in 2015, which sought to understand in more detail how schemes approach and undertake scheme administration and record-keeping.
  4. TPR first set out its perceptions of key record-keeping risks (PDF, 274kb, 41 pages) in 2008 and published guidance on record-keeping in 2010. It has been monitoring progress made by the industry through surveys since 2011. While there have been significant improvements since 2008, the rate of change has stagnated in recent years.
  5. Within public service pension schemes, TPR’s research (PDF, 1.63mb, 49 pages) published in December 2015 showed that only 45% of respondents had measured their data against the legislative requirements applicable to public service schemes, and 3 in 10 had not reviewed their data within the last year.
  6. TPR is the regulator of work-based pension schemes in the UK. We have objectives to: protect members’ benefits; reduce the risk of calls on the Pension Protection Fund (PPF); to promote, and to improve understanding of, the good administration of work-based pension schemes; to maximise employer compliance with automatic enrolment duties; and to minimise any adverse impact on the sustainable growth of an employer (in relation to the exercise of the regulator’s functions under Part 3 of the Pensions Act 2004 only).

Press contacts

Matt Adams 01273 662086