AE error rates spark fears over data integrity
Businesses are experiencing auto-enrolment data error rates of up to 50%, posing questions over the reliability of pension records, Pensionsync says.
The data integration firm said regulations currently only check employers are paying into a scheme, not the accuracy of information.
It said its data from 11,177 pension schemes submitted by 5,931 users of some 13 software providers showed that only 49% of data sent on behalf of employers to pension providers was correct in the first month and must be sent back for correction.
Common errors included contribution levels that are too high or low; contributions being made for workers who do not belong to the scheme or who have opted out; incorrect scheme identifiers; and inaccurate postcodes.
Pensionsync added that these high error rates were adding significant cost and time to pension administration - with many administrators being forced to implement workarounds using spreadsheets rather than dealing with the root cause of the issue.
And it warned there were significant questions over the reliability of current pension scheme records.
At a roundtable held last week to discuss the issue, Pensionsync chairwoman Baroness Ros Altmann said action is needed before confidence is damaged.
She said: "We need to discuss the accuracy of the data before it becomes another legacy issue that needs to be dealt with."
Other speakers at the roundtable said lack of an industry-wide data standard was one issue - as was the fact that not all pension providers were collecting pensionable pay information, meaning they aren't able to check if contributions are correct or not.
Altmann added: "Unless pension providers are collecting salary information, it is not clear how they could check… and the member wouldn't have a clue how to work this out."
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