The evolving role of the pension management consultant

Published by Mandie Bird on

In years gone by the role of the pension scheme secretary might have been taken on by one of the trustees who also acted as secretary, or there may have been a secretary from the sponsor attending meetings to take minutes.

However, in today’s environment there is much more governance on the trustees’ agenda and the scheme secretary has become a full-time appointment in its own right, with a good deal more responsibility than just writing minutes.

A varied role

Day to day I work closely with the chair of trustees.  I’m also responsible for liaising with the trustees’ advisers and the scheme sponsor to ensure that actions from trustee meetings are followed up and that the trustees are meeting all of their statutory obligations and Pensions Regulator guidance.

"It’s evident that this role has truly developed into something much broader than the outmoded notion of a scheme secretary – and it has needed to in order to keep up with the evolving pension landscape."

I provide trustee training too, helping those involved with the governance of a scheme to fully understand, and meet the obligations that come with the role. It’s important that anyone assuming the role of trustee has a good understanding of all the legal requirements, but also has some knowledge of investment, funding and administration.

I can be involved in reviewing premiums for indemnity insurance and other governance issues, for example having an up-to-date risk register in place, complying with conflicts of interest and anti-bribery legislation. Trustees might also delegate some of their duties to me, for example dealing with any member disputes, making suggestions for payment of discretionary death benefits or authorising the expenses of the scheme.

Managing meetings and tough times for employers

I sometimes have to deal with difficult situations in my role, and one example might be with a defined benefit scheme where the employer is struggling to meet the financial burden of the pension scheme.

This is quite often in relation to a workforce that isn’t there anymore – the employer can be contributing a significant amount of funds to provide benefits for people who have either retired or left employment, but the employer is still under an obligation to provide these benefits.  This has contributed to some employers going into administration and schemes moving to the PPF (Pension Protection Fund).

There is a negotiation process between the sponsor and the trustees to agree a schedule of contributions that can be certified by the scheme’s actuary as adequate in order to meet the benefits promised by the scheme.  There is also dialogue around the length of the payment period.

My role is to help manage the meetings, minute the advice and negotiations correctly, and make sure that the trustees are meeting all of their statutory obligations.  I will also help the trustees to meet their roles and responsibilities in considering all the facts in order to make an informed decision. The advice and decision making process needs to be recorded correctly and, once a decision has been made, I will monitor actions of the relevant parties.

I am also involved in member communications: providing details of current topics relating to the scheme, headline accounts figures, what’s been happening on the trustee board, and any new legislation that affects members’ benefits.

governance and legislation

investment and accounts

management and administration

The impact of the changing pensions landscape

It’s evident that this role has truly developed into something much broader than the outmoded notion of a scheme secretary – and it has needed to in order to keep up with the evolving pension landscape. There’s so much regulation and guidance in force these days; every time there is a change in pensions it just adds to the trustees’ responsibilities. More often than not, you can’t take away what was there before; you still have to meet those obligations, but then comply with new requirements as well.

It’s an ever increasing burden on trustees’ duties and that’s why the pension scheme secretary role has become much more of a professional appointment. You could probably write a job description for a scheme secretary (in fact some people do), and that’s one of the reasons why as a firm we offer this role as a standalone service. More and more trustees are appointing professional secretarial services these days.

The new face of pension management?

It’s almost like a new profession, rather than just an add-on to something else. When I first started my pension career we provided secretarial services as part of our administration or actuarial services. Today’s pension's world needs administrators, actuaries and pension scheme secretaries. That’s the way it’s evolved.

This article first appeared as part of the 21st Century Professionals series on the PARN website.

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