The Pension Administration Standards Association (Pasa) has published guidance for pension scheme trustees and managers on data readiness for buy-in and buyout transactions.

Pasa stated that it was crucial for trustees and managers to maintain the highest standards of data quality not only for the purposes of ongoing administration and reporting to The Pensions Regulator (TPR), but also for smooth, efficient and preferential pricing terms when pursuing de-risking projects with insurers.

The guidance aims to support trustees and administrators in preparing for an insurer transaction and covers four main topic areas.

The first is the consequences of holding incomplete and poor-quality data, with Pasa noting that this can create higher transaction costs, delays and uncertainty.

It encouraged trustees and administrators to commit to regular cleansing and monitoring of data, which it said demonstrated the scheme was well managed and prepared to transact.

The guidance also covered the key data items that should be held for all members, with a list summarising the data items most commonly requested by insurers included in the guidance.

It noted that while most of the data items included were required for day-to-day administration, data is often missing from electronic records for some schemes.

Pasa’s guidance also touched on the actions trustees can take in advance of buy-in or buyout transactions to demonstrate good governance.

These included evidencing data is being tested and scored on an annual basis, demonstrating comprehensive data management policies and approaches, and the completion of GMP reconciliation and rectification exercises, among others.

Finally, the guidance covered ‘quick wins’ that trustees and administrators could make in getting their data ready for a buy-in or buyout.

In summary, Pasa stated that good planning and preparation before commencing an insurer transaction helps improve data quality, which leads to more certain and preferential overall costs.

Its recommended approach was an overall data strategy that encompasses transaction preparation alongside GMP equalisation and pensions dashboards.

“Data underpins every aspect of the management and delivery of pension benefits,” commented Pasa chair, Kim Gubler.

“It’s crucial trustees and pension managers always maintain the highest standards of data quality.

“This principle applies not only for the purposes of ongoing administration and reporting to TPR, it also enables smooth, efficient and preferential pricing terms when pursuing de-risking projects with insurers, such as buy-ins and buyouts.”

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