The Financial Conduct Authority (FCA) has confirmed reducing transfer times remains a key priority as it continues to back the Star Initiative and encourage all firms in the pensions sector to take part.
The FCA has confirmed it is looking to the industry-wide initiative – which launched in 2019 – to be part of an industry solution to deliver efficient and timely pension transfers.
The initiative has a commitment to shaping recognised industry-wide standards to promote good practice in transfers, with 78 firms now signed up including Aegon, Barnett Waddingham, XPS Pensions Group, and Legal & General among others.
Star has now launched a reporting system, called Core Management Information (MI), to measure transfer performance. The objective of Core MI reporting is to allow the accreditation of Star members to reflect their performance in the transfer journey.
The reporting system will initially focus on reporting electronic transfers and the reporting of re-registrations and manual transfers will be included when Star feels that there is sufficient data available to report.
Star said this is a “key milestone” and will enable the initiative to become “the single, authoritative source of transfer data on how firms are performing”.
Additionally, regular implementation meetings are being held to allow the industry to collaborate to deliver the Star objectives, and an accreditation roadmap has also been agreed, seeking to accredit organisations in Q1 2022 (for their 2021 data).
The annual accreditation scheme will start in January 2022.
The FCA said it will continue to support Star’s aims and objectives along with The Pensions Regulator and the Department for Work and Pensions and will continue to participate as observers at the Star Steering Group. The watchdog will also continue to encourage firms not already involved in the initiative to take part.
Star steering group chair Andrew Marker said: “Star is a voluntary framework and due to the significant organisations participating, represents a significant cross-section of the financial services industry. We continue to make strong progress despite the challenges of dealing with Covid-19.
“I am delighted that the initiative has reached a significant milestone for us, which is central to our objectives. The last year has been an intense period of work with the industry galvanised to drive forward this solution. Not only will this initiative improve outcomes for customers, but for participating organisations, it will drive efficiencies and save money in the process.”
He continued: “The accreditation roadmap is synchronised with the timings of the FCA who have said they would review progress in 2022 and take further regulatory action if necessary. We are delighted that the FCA encourage firms in the retail investment and pension sectors not already involved in STAR to take part. It is aligned with shared desired outcomes to improve the customer experience, reduce how long it takes to complete transfers and ensure consumers can move to a provider that better meets their needs more easily.”
FCA executive director for consumers and competition Sheldon Mills added: “The FCA is supportive of the progress Star has made to date and the production of Core MI is an important interim step towards achieving its objectives, which aim to bring down transfer times. Full MI reporting, as proposed, seeks to provide equal accountability for firms across the transfer process.
“Reducing transfer times remains a priority for the FCA and full MI will play an important role in ensuring this. Therefore, we are strongly supportive of Star continuing to pursue the full MI and its publication.”
He continued: “We have committed to a review of progress against our desired outcomes in relation to transfers in 2022, and we will actively be following Star’s progress towards its objectives over the next 12 months.”