Scheme member data quality

Maintaining data quality

Good data management is not a one-off task; it is something you need to keep doing. You must monitor the effectiveness of your internal controls for your data.

There are many ways to enable your scheme to maintain good quality member data on an ongoing basis.

Data management strategy

It is good practice to formally capture your strategic approach to member data in a data management strategy (sometimes known as a data management plan). This sets out key data considerations for your scheme. It clarifies who is responsible for data quality and data security and documents your policies and processes for organising, receiving, storing, sharing and improving data.

You should regularly review your data management strategy, especially when there are changes to your scheme. For example, changes to your scheme’s long-term strategy. You need to consider how these changes would impact your data management strategy, and whether new or amended processes are required.

Data quality should be one of the key components of your scheme’s data management strategy. You should document the measures that you and your administrators are taking to maintain, monitor and improve data quality. This provides clarity, accountability and consistency for your administrators and all other providers to manage data in the way your scheme needs.

For practical considerations and examples of content for a data management strategy, read the data management plan guidance from the Pensions Administration Standards Association (PASA).

Managing your administrator

You should have a clear agreement with your administrators on the measures for your scheme’s data quality assurance. If you are using a third-party administrator, this should be reflected in contractual documents.

You should review your administrator’s performance against these measures on a regular basis. If the contract or agreement is not effective in ensuring data accuracy and member experience, you need to review and update them.

Further information on appointing and reviewing administration performance can be found in working with advisers, and administration guide.

Quality assurance measures

You should ensure there are sufficient quality assurance processes in place to minimise the risk of data errors caused by poor systems or processes. This includes validating at the entry point when data is received from employers or members, for example conducting bank account verifications or address look-ups. Quality checks should also be built into specific processes, for example checking a sample of annual benefit statements or manually verifying transfer values before these are issued.

Administration and data reports should include insights on errors and be sufficiently detailed to help you identify whether changes to the administration systems or processes may be needed. If you currently do not receive this information in your regular reports, you should explore the addition of this information with your administrators.

It is important that the data process manuals are kept up to date, are relevant to the needs of the scheme and clearly documented. This is to maintain continuity and consistency of service even if there is any change or interruption in administration personnel or service providers.

Further information on quality assurance can be found in our administration guide.

Work with the employer and other data providers

Your administrator needs to accurately transfer members’ data on time to and from third parties, such as employers, additional voluntary contribution provider/s, actuaries or tracing agents. As a governing body, you need to support your administrators to set up and maintain clear data sharing processes with these data providers.

Wherever possible, data should be transferred between these parties electronically and securely. Robust data sharing processes reduce the risk of data errors. Validation checks should be built into the process to identify any inconsistencies.

Employers, including their payroll function, play a vital role in this process. You can support your administrator by educating the employers to understand their role. The employer should provide the required data, monitor it, and notify the scheme whenever there are changes to it. The employer should provide:

• contribution details
• joiners and leavers details
• changes to members’ personal details, including contact details and beneficiaries’ details
• changes to pensionable pay, including changing of working hours

It is good practice for your employer to nominate a point of contact for your administrator. This is so any data queries can be efficiently resolved. You could also invite someone from payroll to board meetings that the administrator attends.

Ongoing monitoring on the effectiveness of the data sharing processes will enable you to identify areas where improvements could be made. For example, if your administrator has to frequently raise queries with certain employers about the quality of data received, there might be validation checks that the employer can put in place to reduce the number of queries and improve data quality.

Engage with your members

Regular and targeted member engagement will also assist you in maintaining good quality data. You should ensure that there are simple and accessible routes for your members to update their information easily, for example via a call centre, email, or online portals. You could also use these to remind your members that it is important to keep you updated with any changes and to educate them about the consequences of not doing so. You should also consider accessibility issues when designing your communication channels.

You should seek opportunities to obtain the latest member information, such as when responding to incoming queries.

Care should be taken to verify the identity of the individual and conduct suitable data validation to ensure the quality of data is sufficiently good at the entry point. You should make any updates in a timely manner.

Where appropriate, you should consider introducing a policy for member tracing. This could be targeted to member types, age, statuses, or specific data items to make it more effective. The introduction of pensions dashboards provides an opportunity for you to trace members. You should ensure that your matching policy is designed to assist you in identifying matches.

You should also have a good understanding of the interaction experience that members have with administrators, including complaints or members’ feedback on the administration service. Member experience is a useful measure of the scheme’s data quality level.

Technology and data standards

Your scheme should have sufficient IT systems to deliver the administration function and maintain data quality. Automating administration tasks and processes, where possible, improves data accuracy, reliability, and compliance with regulatory requirements. You should regularly consider whether any administration or technology innovations could improve data quality, for example automated address verification. It is important that any software used to carry out data-related tasks is tested both at the point of implementation and on a regular basis after that.

To support interoperability, transparency, and futureproofing of pension scheme operations, you and your administrator should consider aligning your data practices with open standards for government data and technology. Open standards are publicly available specifications that define how data should be structured, formatted, and exchanged. They enable interoperability between systems, promote data consistency and reuse, reduce vendor lock-in, and support digital transformation and members’ access to services.