Paul Lalwan calls for the UK to emulate other countries and track our pension benefits, co-operation from pensions administrators is much needed.
Earlier this month Mrs. S sent us an email: Could we help her locate her late husband's pension? She knew that he worked at a company for a number of years in the seventies but she didn't know the name of the employer or any other details.
We explained to her how the website helps former members and surviving partners to locate and claim their pension pot or survivor entitlement.
She thanked us and promised to tell us if her search was successful.
This lady may well find what she is looking for but how did she find herself in the position of having to do this search in the first place; how many others are in the same position and what can be done about it?
These questions are moot in the Netherlands, Denmark and Sweden who have versions of a pensions dashboard where their citizens can see at any time all their pension benefits. Belgium, Hungary and France are in the process of developing a national pension tracking system.
The 6,000 DB schemes in the UK have over 7,000,000 deferred members and at certain trigger points such as impending retirement or death of a member administrators use a number of methods to find beneficiaries including DWP letter forwarding, tracing agencies, section 27 notices, 192.com and, following our launch in 2014, PensionsLink.com incorporating FindMyLostpension.com.
The Pensions Tracing Service provides consumers or their IFAs with the address of a former employer that may have a pension waiting for them.
However these and other data cleansing methods are not totally effective as evidenced by the existence of more than 1,250,000 deferred members who cannot be contacted as their records have out-of-date contact information leaving a significant number of them, at least 100,000, that have reached retirement age but are failing to receive their pension.
Perhaps there's nothing to be done? Perhaps trustees are fulfilling their duty of care to the best of their ability? Perhaps the responsibility rests with the member to contact the scheme (quite a popular view)?
Well, not necessarily.
The UK is more than capable of emulating the success of other European countries in providing a service for consumers to keep track of all their pension pots.
Co-operation from pension administrators, innovative, open-source technology and TPAS, MAS and CAB utilising their almost universal marketing reach would undoubtedly re-unite millions of people with their lost pension pots as well as helping people plan more effectively for their retirement.
The Dutch pension tracking system cost several million euros to develop. PensionsLink.com, a less ambitious but robust and effective tracking system, was built for considerably less. To fully engage with a national tracking system pension schemes and their sponsors need only to allocate a small proportion of the GBP 2.5 billion spent yearly on advisors and administrators.
The outcome would reduce scheme administration, cut expenditure, lower future liabilities and most importantly, make it a lot easier for Mrs. S and others like her to claim their rightful entitlements.
Written by Paul Lalwan, Co-founder of PensionsLink and FindMyLostpension.com.
