The biggest challenge in pension administration (ever?) is upon us
In 2016 contracting out will cease, arguably creating the biggest pension administration challenge in the UK for many years, if not ever. Over 4,000 contracted-out schemes, covering over 20 million members have, just two years (starting now) to reconcile their member GMP values with those held by HMRC. In 2016 HMRC will cease to provide a scheme reconciliation service and in 2018, HMRC will write to all contracted-out members notifying their GMP entitlement. Reconciled or not!
How will you cope with the GMP challenge?
If you are a pensions professional with responsibility for administration, you are probably operating at full capacity, with tight budgets and limited resources. The last thing you need is the distraction of a full scale GMP reconciliation project. But you will need to do one. Traditionally, GMP projects have sucked in resource with largely manual processes, budgets have been stretched beyond reason and many years elapse before reaching the ‘holy grail’ of reconciled GMPs.
How ITM can help
As the market leading data and systems specialist, we have developed an automated GMP reconciliation methodology that greatly reduces the time, effort and cost of the traditional approach described above. To help you, ITM can either undertake the entire GMP reconciliation project or work alongside your administrators to undertake discrete elements of the overall project. Remember, the project doesn’t end once you agree a GMP with HMRC - the next step is to ensure your pensions are correctly tranched and then analyse and rectify any overpaid and underpaid pensions. ITM can help with this too, again using our wealth of data cleansing experience and bespoke data cleansing automation. And then of course there is GMP equalisation, but that’s for another day...
John Broker is Sales Director at ITM