While automatic enrolment dominates the agenda of pensions managers, Premier's Hazel Bloomfield says there is a danger that other deadlines could be marginalised, or may not even be discussed at all.

I'm late, I'm late for a very important date! No time to say hello, goodbye, I'm late!... I'm late!... I'M LATE!

Just like the fictional white Rabbit in Alice's Adventures in Wonderland, we can all feel under pressure to meet those all-important deadlines. Whether it is making sure that all the employee records are up-to-date or that the payroll run is closed in good time, the working day can often be a succession of never ending deadlines, going around and around and around.

Whilst automatic enrolment dominates the agenda of HR and pensions managers alike, this can often mean that other looming deadlines are being marginalised or worse still not even discussed.

One key area that we are seeing fall foul of this is the humble Guaranteed Minimum Pension (GMP) reconciliation exercise. Is your scheme a closed final salary scheme that was contracted out of the State Second Pension (previously the State Earnings Related Pension Scheme)? If it is then you would have needed to surrender your contracting out certificate when you closed the scheme to further accrual of benefits. Whilst the surrender of the certificate in itself is not an onerous or time consuming task, trustees and sponsors are often not aware that this process triggers a chain of work that needs to be carried out by the scheme administrator and that there are timescales within which HMRC will require these tasks to have been completed.

After surrendering the contracting out certificate, trustees will receive reinput schedules from HMRC. These are paper schedules, which record each members GMP at the date upon which the contracting out certificate was surrendered. HMRC will expect trustees to work with their advisors to return the completed reinput schedules, advising HMRC that they either agree or disagree the GMP figures notified on the schedules within two years. On the face of it two years seems a long period of time and the trustees may feel safe in prioritising other work items above this, but in the pensions industry time, is a precious commodity and there are always new rules and regulations on the horizon which mean that work items get side-lined.

Trustees should not underestimate the work involved in reconciling the records between HMRC and the scheme administrator. This will include an analysis of those that have left the scheme through either transferring or taking a full commutation at retirement as the liability for these members will no longer form part of the scheme liabilities and should have been notified to HMRC accordingly. Similarly there may also be members that have transferred benefits into the scheme or whom HMRC record as members of the scheme but for whom you hold no details. In each instance a full reconciliation between the records of HMRC and the scheme administrator will need to be undertaken and the records fully matched.

This work is often time consuming and needs to be undertaken in addition to the main day-to-day administration of the scheme and the timescales and costs for completing the exercise can quickly mount up. We would encourage all trustees that have surrendered their contracting out certificate to check with their administrators what progress if any has been made to complete this essential reconciliation exercise and ensure that it features on trustee meeting agendas. Also we would encourage all trustees to ensure that they are aware of the costs of the exercise upfront and to negotiate a fixed fee wherever possible.

With the ending of contracting out on the horizon and further details on GMP Equalisation expected in the Summer of 2014, it is anticipated that there will be a large number of calls on the HMRC reconciliation teams to complete the reconciliation exercise and we would encourage trustees to do all that they can now to get ahead of the pack and to prioritise this work if they are able.

Fully reconciled GMP data is also a big tick in the box for those considering a buy-in or buy-out as the insurer will place less margin for error when assessing the scheme data. Even more excuse not to become the white rabbit and be late, be late for that very important date.

Written by Hazel Bloomfield, consultant, Premier