The popularity of master trusts in the defined contribution (DC) pensions market has grown considerably over the last few years, particularly with the advent of auto-enrolment. But despite many large schemes being newer to the market, master trusts do not come without their data challenges.
According to research we conducted last year, 92% of master trusts were being used for auto-enrolment purposes with a huge majority accepting employers of all sizes. You can read the full report here. On a daily basis, hundreds of thousands of member data records are being shared between employers and their pension scheme. Your scheme must constantly keep up with changes in personal details, employment details, earnings and contribution levels. You’re also likely to be receiving individual record updates from members themselves or may be receiving data directly from payroll. This creates a mixing pot where discrepancies between employer records and those which you hold are rife. Strong validation processes are vital when it comes to the source of data.
An added challenge comes from transient workforces, where employees regularly move from company to company – something which is not uncommon in many industries. Your data may have to keep up with frequent changes, as well as matching new employer records to existing members to avoid duplication.
There is an increased focus on the way a pension scheme manages data, to ensure compliance with the Pensions Regulator’s record keeping requirements and Code of Practice 15, to put your pension scheme in good stead for ongoing supervision once your master trust is authorised and pensions dashboard too. Good record keeping data scores can also be used to demonstrate good governance practices – enticing new business.