Pensions administration is set to move from a back-office operation to a core element of scheme governance by the end of the decade, driven by regulatory pressure, technological change, and heightened risk awareness, LCP has predicted.

Writing in a blog post, LCP senior consultant, Ella Holloway, said the revised administration guidance from The Pensions Regulator (TPR) had clarified expectations for trustees and signalled a shift in how administration should be viewed, placing it firmly at the centre of effective governance rather than as a supporting function.

The guidance, which replaces TPR’s previous guidance on the administration of defined contribution (DC) schemes and applies to all scheme types, provides practical steps for governing bodies to ensure high-quality administration that meets regulatory expectations.

Holloway argued that, by 2030, trustees and sponsors would increasingly expect real-time, transparent oversight of their schemes, supported by digital tools that provide a holistic view of funding, investments, administration performance, and covenant strength.

However, she warned that improved governance would rely on fast access to accurate information, allowing trustees to understand what is happening across their scheme at any given moment and to respond more quickly to emerging risks.

Holloway highlighted pensions dashboards as a key driver of change, both for members and for schemes themselves.

By the end of the decade, she suggested that deferred and active members could expect automated, real-time access to their benefit information, alongside interactive tools and personalised content.

As dashboards evolve, Holloway added that integration with open banking may allow members to view their pension savings alongside current accounts and other assets, reinforcing pensions as part of everyday financial planning.

This shift in member expectations would, in turn, place greater demands on administrators to deliver timely, accurate, and accessible information, she said.

With this in mind, Holloway noted that AI could play an growing role in improving member communications by tailoring content to individual preferences and needs, while also supporting governance by helping to detect scams, speeding up scheme onboarding and automating routine tasks such as logging correspondence and allocating work.

This, she said, would allow experienced administrators to focus more of their time on complex cases where professional judgement adds most value.

Holloway stressed that people would remain critical to high-quality administration.

She noted that recruiting and retaining skilled administrators would continue to be a challenge, particularly as defined benefit memberships age and administrators spend more time supporting pensioners and vulnerable members.

Therefore, expertise in areas such as powers of attorney and other forms of delegation is expected to become increasingly important, alongside strong communication skills and a clear focus on member outcomes.

Professional qualifications were also likely to evolve to reflect the changing nature of administration, with greater emphasis on areas such as de-risking and endgame planning, she added.

Meanwhile, Holloway warned that the rollout of dashboards was likely to expose weaknesses in legacy data, while ongoing de-risking activity among schemes running on will continue to require clean and accurate records.

Subsequently, she said that, by 2030, the value of high-quality data should be more widely recognised across the industry, with new approaches emerging to help maintain it, potentially including the greater use of information held by credit reference agencies and the development of more robust national identification systems.

Elsewhere, cyber risk was identified as another factor pushing administration up the governance agenda.

Holloway said recent high-profile incidents had sharpened trustee awareness, with many now recognising that cyber attacks were a matter of “when, not if”.

By 2030, she suggested that a significant number of schemes will have tested their cyber response plans in practice, with incident scenario planning, training and regular risk assessments becoming a routine part of trustee business.

Schemes that had invested early in preparation and controls were expected to be better placed to respond quickly and limit disruption.

While Holloway acknowledged that not all predictions would necessarily be realised by 2030, she said the regulator’s renewed focus on administration was a positive step for the industry.

Strong administration, she concluded, underpins effective governance and helps ensure trustees and members receive a reliable, transparent and responsive service, with the revised guidance providing a clearer roadmap for raising standards as schemes adapt to a more complex and risk-focused environment.

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