In the Australian pensions market — known as superannuation — they experienced very similar issues when they introduced their version of workplace pensions two decades ago, so they have had a lot more time to work the gremlins out of the system.
I see the same thing happening in the UK once we start digitising and cleansing this data and seeing it work.
There are things companies can do in advance of connection to prepare. For example, providers should be using next-generation data specialists, such as Target Professional Services or mypensionID, to verify quickly members identity through a few clicks of a button, rather than the long, drawn-out process of postal verification.
Ultimately, quality data will be essential for the successful rollout of pensions dashboards. It is where providers and schemes have not done the necessary verification and cleansing that things can and will go awry.
One of the issues we have is that the legislation has left it up to the schemes and providers to decide what is appropriate from a matching criteria perspective.
The Pensions Administration Standards Association has given the industry some good-quality guidance as to what is suitable and best practice. We have used that in our technology because we think it makes sense and, if your data passes muster, that gives you the best of both worlds.
What you should not be doing is matching people incorrectly, that is the absolute crisis scenario. But I do not see that happening because ID verification is secure and it will be hard to get past that as an individual — that is why using appropriate matching to your data is key.
Also consider edge cases such as twins or triplets, or people with very common first and surnames that were born on the same date — the John Smiths problem as I call it — which could create a “possible match” scenario, where certainty is less than 100 per cent.
This is where artificial intelligence comes in — you can apply an algorithm to the data set to try to match against different data points. We also expect a UK digital ID in future, which will help.
Upgrading dusty tech
The pensions world has not always been the swiftest innovator, so it may struggle to get on board with this new technology quickly enough.
That is where tech organisations come in, because we are bridging the gap between the legacy tech that should have been retired long ago and modern data techniques.
