PLSA LAC 2019: 15% of LGPS funds not submitting complete ABS

Fifteen per cent of Local Government Pension Scheme (LGPS) funds were not submitting all of their annual benefit statements (ABS) with all of the information required by law, The Pensions Regulator (TPR) has revealed.

Presenting at the Pensions and Lifetime Savings Association's (PLSA) Local Authority Conference, TPR head of policy, Fiona Frobisher, said: “For a scheme with a lot of members, that's a lot of members who are not receiving the information about their benefits and, therefore, aren't able to do the planning that they want to do for their retirement, so it's an issue, it's a problem.”

In its survey, 2018 PSPS Governance and Administration Survey, TPR also found that 7 per cent of LGPS funds did not issue ABS to active members within the statutory deadline.

Missed ABS deadlines were reported at a breach of law by 26 per cent of funds, while a further 8 per cent reported the delay to TPR, not but as a breach of law.

In total, 56 per cent of LGPS funds issued all of their ABS within the deadline, up by 11 per cent in comparison to 2017.

The survey also revealed that only 48 per cent of funds reported that at least 90 per cent of employers provided timely data and just 43 per cent said that at least 90 per cent of employers provided accurate and complete data.

Both of these data figures were below average in comparison to other pension schemes.

Frobisher added: “For local government schemes, a lot less of the employers are submitting data monthly, or submitting it electronically.

“Moving to those kind of processes might help some local government schemes to get data from their employers between and more accurately.”

TPR discovered that the main barrier to improving scheme governance and administration was the complexity of the scheme, with 60 per cent of respondents citing this as a reason.

Complexity was followed by employer compliance (56 per cent), recruitment, training, and retention of staff and knowledge (49 per cent), and lack of resources (47 per cent).

However, the regulator found that governance as a whole had improved, with 80 per cent of LGPS funds having a series of measures, including procedures to identify breaches of law, assessing risk and resolving payment issues, representing a 10 per cent year-on-year increase.

Despite this, the regulator was concerned that many schemes were not using these tools effectively, but also noted that this was more of an industry-wide problem, rather than something specific to LGPS funds.

Frobisher said: “We need to move from people having things in place to their use being effective."

TPR noted that there were issues with legislating, including Brexit, and it encouraged further communication and collaboration between funds.

    Share Story:

Recent Stories

New
New
New

The modern age
Deputy editor Natalie Tuck chats to the ABI’s Yvonne Braun about her work at the ABI and her thoughts on key pension topics

Stepping into the spotlight
Laura Blows speaks to Laird R. Landmann, group managing director and co-director of fixed income at US-based TCW, about the opportunities TCW can provide for UK pension funds