Statement season: Moving online and giving more time

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The Pensions Administration Standards Association has issued a supplementary paper on statement season considerations.

PASA has highlighted key issues which will be crucial to the success of the statement season project, and makes suggestions to help address them. This latest publication comes after an initial paper was released in September looking at administration aspects of the proposals.

“PASA recognises the importance of the government’s wish to increase saver engagement and is supportive of the aim to draw saver attention to their pension savings on a regular basis,” said Sackers partner Helen Ball, who chairs the PASA Benefit Statements Working Group. “This paper provides constructive suggestions to help government meet its objectives and increase saver engagement with, and levels of confidence in, pension savings.”

Season duration and window

The season has been recommended to last for three months, instead of a shorter period. The aim of this would be to provide a reasonable window to issue statements and respond to the resulting saver queries.

Expanding the window addresses concerns of overwhelming savers and pension providers. The introduction of any season is likely to require a shift of existing administrator resourcing and the re-prioritising of annual events across a scheme year. The larger the scheme, the greater the challenge can be.

Bearing this in mind, PASA has said that more time for the statement season will give opportunity for individual schemes to juggle their other deadlines.

September, October and November are the recommended months for the statement season window. PASA commented that there is no perfect time which would balance the importance of the season against the schemes to comply, but a window running through this time will avoid the start of the calendar year, the summer holidays, and the end of the calendar year.

Going digital

The strongest feelings about the statement season have been generated by proposals requiring the issue of paper-based statements. Sir Steve Webb, partner at consultancy LCP and a former pensions minister, previously described a paper statement season as an “analog solution in a digital world”.

Regarding accessibility, 96% of households in the UK had access to the internet in January-February 2020 according to the Office for National Statistics. PASA commented that given the global transition to online, paper statements would be a regressive measure.

The pensions dashboard

Using a common ‘as at’ date as a basis for the statement season information and the suggested approach for pension dashboards has been recommended to enhance saver understanding and engagement. This would focus the information delivered to savers around a sufficiently recent date, so information will be consistent with what appears on the dashboard.

However, PASA disagrees with any proposal requiring administrators and trustees to change their current valuation dates used within annual benefit statements, saying this would result in unnecessary changes to timetables, potential disruption to administration and unnecessary cost and complexity.

There are still crucial decisions around the statement season that need to be made, which Ball has said could determine the overall success of the project. “There’s considerable concern in the industry around these issues, which must be taken into account when the final proposals are put forward for consultation,” she said.

PASA has said that ideally, the first statement season would launch in autumn 2023 to allow administrators time to test their operations.

Have these recommendations changed attitudes to a statement season? Will a statement season help engage savers?

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