The payment of benefits has been identified as the key service schemes need to maintain during the pandemic – putting the onus on administrators to make this possible. PASA has just issued some high level guidance, but what are administrators doing on the ground? 

 

Scheme administration is the ‘coalface’ of pensions, where cash comes in and goes out and where members’ queries and complaints tend to land. With social distancing making such essential office-based work impossible, how have administrators responded? 

 

 

The sector seems to have adapted to remote working relatively swiftly.

“We fully closed our office over two weeks ago and have no staff onsite,” said Daniel Taylor, director at Trafalgar House Pensions Administration. The decision to move to home working early on was influenced by the fact the company is based in London – which has been hit first and so far worst by Covid-19. 

 

Fortunately, sickness absences due to the virus are however not an issue to date, with less than 2% having been off because of a link to Covid-19, according to Taylor. “Monitoring this however has now become our key focus,” he added.. In case the number of people who are off sick increases, members of the project teams have been trained to step in. 

 

As well as the core activities, project work is also still being carried out at the moment, he noted. Although both core and project work is going ahead, there are however hurdles to working in the current environment, including interaction with third parties, as well as trustees not having moved to accepting digital signatures from members yet. 

 

The increased risk of scam activity is a further challenge for administrators. “We are warning members to be vigilant and we are stepping up scrutiny and examination of all transfer activity,” said Taylor.

The Pensions Regulator, the Financial Conduct Authority and the Money and Pensions Service are clearly worried about vulnerability to scams increasing, having issued a joint warning to savers on Wednesday, urging them to stay calm and not rush decisions they might regret later on. 

 

With people working in a remote setting, information security also becomes a concern and a risk that needs to be managed. 

“We need to make sure that only Trafalgar House personnel come into contact with any data we manage – including telephone calls. With households all working and living together we have provided our team with new guidance on security measures as well as looking at what additional security equipment they may need,” Taylor noted. 

 

  

Most large pension funds are imploring scheme members to minimise calls and instead consult the scheme website as they anticipate a rise in queries. 

The RBS Group Pension Fund, for example, notes that “we do anticipate an increased level of enquiries at this uncertain time so please ensure you use the online tools and resources first”. The Invensys Pension Scheme, BTPS, the British Coal scheme and EDS Pensions are just some of the schemes that have published similar requests on their websites. 

 

But this prediction of increased activity has not been borne out thus far. In fact, Taylor said that over the past two weeks, there has been a 30% drop in the level of member enquiries at Trafalgar House. “We have published a number of messages of reassurance to members but there hasn’t been a particular spike,” he said.  

 

Members have – thus far – also not tried to cash in their pension to support them during this economically difficult period. 

“We were anticipating that members may turn to their pension to access additional funding, but that hasn’t manifested yet. This may come later as the financial impact of the economic [downturn] starts hitting people over the next few weeks,” he observed. 

  

Similar behaviours have been noticed elsewhere. David Watkins, managing director of XPS Administration, said that “there is some evidence that the volumes of post [and] contact has, if anything, reduced slightly when compared to pre-pandemic levels”, while the manner of interaction has not changed so far. 

 

Unlike Trafalgar House, XPS maintains a small presence in the office, of 2% of staff. Watkins said that only a very small number are self-isolating, while sickness levels are no higher than before the pandemic started. "There is no reduction in our capability, range of services, or focus on delivery and looking after members," insisted Watkins.

 

The administration arm of Barnett Waddingham also maintains some office-based staff to deal with post, scanning and printing. A partner at the firm, Julian Mainwood, explained that this is done using a rota system “where staff are willing and able to do so”, including not having to use public transport. Those who have to travel to the office are provided with ‘Key Worker’ letters in case they are challenged. 

 

Like Trafalgar House and XPS, Mainwood said everything is “business as usual” at the moment – but things are kept under review, he admitted, “as we may find the focus of both ourselves and our clients changes in the coming weeks”. 

 

Daniel Taylor

Julian Mainwood

Margaret Snowdon

Ian McQuade

Michael Clark