"Data cleansing will therefore be an essential investment that will need to take place on a significant scale over the coming months and years."
As part of the Prototype project, ITM produced analysis on the quality of existing pensions data that could be used as a basis for matching data to an individual in the final working Dashboard.
Accuracy and availability of national insurance numbers, date of birth, postcodes and initials/surname were all identified by ITM as being essential for live Pensions Dashboards to function effectively.
Data from over 440 pension providers and schemes with more than 20 million members in total were assessed for ITM’s research.
Pension products set up before the year 2000, which account for over three fifths of the total number of member pots featured in the survey, were found to have the highest average levels of inaccurate or missing customer data, something that is often triggered by issues with legacy books and systems. Just under 30% of workplace personal pensions and over 20% of defined benefit occupational schemes featured this type of ‘dirty data’.
Postcode data was identified as a particular issue for occupational schemes, with 60% inaccurate or missing amongst defined benefit schemes from before 2000 with a value of between £100-200,000. Over 30% of postcode data was also flawed in all other defined benefit and defined contribution occupational schemes surveyed, regardless of the pension pot value.
Dates of birth were inaccurate for around 30% of defined benefit occupational schemes during this time, while there were no inconsistencies at all for any occupational schemes established after 2000.
NI numbers proved another significant area of inconsistency for approximately 50% of both workplace and group personal pensions set up before 2000. Worryingly, inaccurate NI data was also found in around 20% of defined contribution occupational and auto-enrolment schemes after 2000.
ITM chairman Duncan Howorth, said: “It’s no surprise in some ways that pension products before the millennium have the poorest quality data, given that many of these survey respondents will have inherited a portion of their data from previous providers where data was maintained on different systems and even in some cases, hand written documents.
“These high levels of inaccurate data reveal that the industry is a long way from achieving the high data standards needed for fully functioning Pensions Dashboards. Connecting the sheer volume of data out there is a crucial challenge that has held up the development of the Pensions Dashboards until now and it will only be of real value to consumers if they can access data that is current, accurate and complete. Data cleansing will therefore be an essential investment that will need to take place on a significant scale over the coming months and years.
“As a technology partner for the Dashboard prototype, ITM has been working to integrate data and create these data matching standards that will be key for pension schemes of all shapes and sizes to make their information available, economically. We’ve been calling for all pension providers participating in the live Pensions Dashboards to establish an industry data standard and our research findings support the need for this level of continuity. Indeed, it’s our belief that pension providers must achieve a minimum data quality standard before they can sign-up to the live Dashboards. If the data standard is too low, the quality of the output in a ‘live’ environment will be highly unreliable.”
