Scheme health check
Value for Member rules will require you to take a good look at what your scheme is offering, crunch some investment numbers and compare against three other similar pension schemes.
Evolve operates a Master Trust, Crystal, which has been subject to high-level regulation for a number of years now. Crystal has exceptional governance, administration and high performing investments so we have used those ingredients for you to assess against.
Our health check should take about 5 minutes to complete and leave you with an idea of how you might compare to some of the best schemes available to Members, whether it is a reassurance that your scheme is in great shape or motivates you to push to a higher level, we hope it helps as a first step.
Starting with investments. You will need to carry out some investment performance calculations but also consider the quality of the way you select and monitor the investment options you offer. Rate your scheme on your investment offering below. To help you gauge what we consider each rating to consist of we have put together a brief guide:
You may offer a single default fund or a static lifestyle for Members with a range of self-select funds which have remained unchanged over the years.
You may review investment performance against expectations but typically take an Investment Consultants lead and tend not to look further than standard reports.
You have a few documents detailing the investment funds and aims and dedicate some meeting time to investment matters.
You have not yet considered ESG factors and could be finding it difficult to get information about charges and transaction costs. You also have not had the time to think through post-retirement options for Members.
Considering how your scheme is looked after, and risks are controlled. Governance is a broad topic and we have considered each rating and shown a brief guide:
You have trustees, the majority of whom are not pensions professionals but have undertaken some trustee and pension specific training.
Meetings take place regularly but you do not spend time assessing the effectiveness and skills of the trustees.
You have basic timetables, agendas and policies which the trustees review occasionally and a simple risk register that is updated when significant changes become apparent.
You have contracts in place with service providers and review them every few years.
You carry out the standard annual audit and consider anything in the audit findings report.
Thinking of how your scheme is administered and feedback is monitored, you will need to consider how your administrators provide information to the trustees, how they handle Member requests and how Members can access information amongst other things.
You have a third-party administrator or have in-house administration capabilities which provides basic information at trustee meetings including performance against SLAs. You undertake a triennial review.
Your Members receive paper or email communications, can talk to an administrator on the phone and may have access to a website which shows them their current fund value.
Your administrator can demonstrate a basic level of control around data protection and keeps a log of complaints alongside the scheme's formal complaints procedure.
You can ask for a report detailing data quality which makes you comfortable that the record keeping is in order.
And finally, when it comes to communicating with your Members, which of our ratings best matches your current scheme.
You operate a suite of letters which are reviewed occasionally and when legislation changes. You are comfortable that all the relevant regulatory information is included but this does mean some of the letters are long.
You take into consideration any feedback which arises through complaints but do not actively seek any other feedback.
You offer a basic Member website with scheme booklets, forms and some links to other sources of information.
It looks like your scheme might need to consider a few improvements.
Based on the ratings you have given it looks like your scheme might need to consider a few improvements and should be aware that when comparing with other schemes you may need to show regulators how you will deliver those. You will need to assess your scheme against three other schemes so start gathering information which covers the categories above. You may need to explain why you chose those schemes so consider those with similar profiles, and do not forget you need one of those schemes to be able to offer you terms if you were to need to transfer your scheme.
If during the process you find that you have a number of improvements to make then you may need to create an action plan to show how you will take that next step or consider your options with other schemes.
Evolve have prepared a comparison pack for schemes, enter your email address below to and we will have it to you in 3 working days. If you would like us to provide terms in order that you can meet your Value for Member requirements or to consider consolidating your scheme with us please also supply the following details: