Hargreaves Lansdown head of policy, Tom McPhail, has been announced as the founding chair of STAR Steering Group, government backed initiative aimed at delivering a long-term governance solution to transfers.

The group, which will have members selected from firms participating in the initiative, will be responsible for overseeing the operational delivery of the underlying working groups.

Criterion managing director, Caroline Mansley, said it now has 14 organisations who have committed in principle, up from the 11 reported at the start of the 2019. It hopes to have 30 signed up by the end of March.

The steering group will be tasked with creating and maintaining service level agreements (SLAs) to effect smoother transfers for consumers across the pensions industry.

On the announcement, McPhail, said: “Government and regulators have set a clear challenge to the industry: fix this for the benefit of your customers or we’ll impose regulations on you. Like many other companies, Hargreaves Lansdown is working hard to improve our processes and to go the extra mile for our customers.

He added that the industry must work together and that the cost will be offset by the savings that will be made from “faster, simpler administration”.

Mansley said that the steering group will be made up of senior members, and overseen by the Financial Conduct Authority, the Department for Work and Pensions and other consumer groups.

“Tom McPhail chaired Transfers and Industry Re-registration Industry Group (TRIG) for two years so knows the issues inside and out. Also, it is important that we have an independent chair who can lead the steering group in this important work for the industry.

"I see this as a snowball which now is rolling and will quickly grow momentum and create impetus across the industry. This is not an issue that is going away. It is one firmly within the immediate focus of government and the regulator."

STAR, a joint venture between Criterion and TeX, made the announcement at a seminar attended by over 90 industry representatives, held by the Association of British Insurers.

TeX director, Carol Knight, added that it was about driving forward industry standards, not how individual companies optimise their transfer performance and hopes to have all aspects of the industry represented.

The initiative, which received backing from the Pensions Minister Guy Opperman and other industry heavyweights in October last year, will look to deliver a framework built by the TRIG.

The framework specifies three weeks for an occupational pension transfer, and will aim to deliver benefits to both consumers and firms looking to gain from “consistent and improving standards”.

Once the group has reached 50 sign-ups, a cross industry steering group will be developed, and an independent chair appointed, who will “govern the execution” of the framework.

Additionally, Star will run a bronze, silver and gold accreditation process, rubber stamped by the FCA, in a move which the group hopes will “shine a spotlight” on firms that are underperforming.

According to Criterion, the measures will take roughly two years before consumers will feel the benefit, but will eventually result in speedier transfers, improved control over their money and increased competition.

Firms who sign up to the initiative will pay a £3,000 joining fee and an annual £1,700 fee for maintenance development, which firms could end up paying three times if they qualify for each stream.

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