Topics don’t come much more complicated than GMP equalisation.

We’ve spent the past few months taking time to speak with administrators to understand how the market sees GMP equalisation, and how ready they are for the potential tidal wave of GMP work about to flood the industry.

There is apparent consensus on methodologies. Conversion (method D) is likely to be the most expensive to implement, but the most efficient for ongoing administration.

Calculating comparative benefits (method C) is likely to be the exact opposite; easier to implement but less efficient and more expensive for ongoing administration.

Analysis is being carried out on the client base and resource requirements, and developments are being made to tools and systems.

Some are relying on spreadsheets; others have sophisticated tools to model the impact.

What is clear is that most pension schemes are awaiting others to move first and for potential further judgements.

Except those trustees that have been compelled to act for buyouts and other de-risking activities, few have taken steps to prepare.

GMP work is already keeping many administrators busy. Throw in equalisation from a handful of clients at once and things start to look stretched.

There is potential risk in doing nothing but steps can be taken now with data and initial analysis.

Indeed, if you are a trustee with clear strategic objectives, it would be a good idea to partner with your administrator now so that your goals are not jeopardised when the tidal wave breaks.

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