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02 / 12 / 2025
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Pensions Administration is having a ‘Cinderella moment’
David Fairs, Chair, Pensions Administration Standards Association
Pension administration has long been seen as the unglamorous, back-office function of the industry. Yet, as I have witnessed throughout my career, its role is absolutely critical, not only to the smooth running of schemes but to deliver confidence in the pensions system and give satisfaction to members and savers.
As I discussed recently on Brightwell’s Pensions Unpacked Podcast, in the past, parts of the pensions industry has lagged the rest of the financial services sector when it comes to innovation, but times are changing.
We see administrators implementing fully online retirement journeys, benefit statements delivered by avatars, and artificial intelligence being used to triage workflow and onboard new clients. Both at the front and back end, technology is transforming the landscape. However, this progress is not universal. Some administrators still struggle with incomplete paper records and outdated systems. The question remains: why aren’t more schemes investing in digitisation and automation?
The answer often comes down to cost. Trustees have historically focused on the price of administration rather than the value it brings. Yet, as regulatory pressures mount and member expectations rise, this approach is no longer sustainable. The pensions dashboard, for example, is a game changer. It demands complete and accurate data, and it will drive greater traffic to administrators. Without digitised records and automated calculations, schemes will find themselves running ever harder just to keep up, risking errors, inefficiencies, and ultimately, member dissatisfaction.
The risks of outdated systems are manifold: inefficiency, increased errors, cyber security vulnerabilities, and higher costs. But perhaps most importantly, they threaten the very sustainability of pension schemes in this digitised world. As the dashboard comes online, those who have not invested in modern administration will struggle to survive.
Regulation has a role to play. Some schemes, such as defined contribution master trusts, are already heavily regulated, with requirements to demonstrate robust systems and processes. Accreditation, such as that offered by PASA, aligns closely with the regulator’s expectations and should be a benchmark for all administrators. However, regulation must be proportionate. Rather than imposing heavy new burdens, we should focus on plugging the gaps and ensuring that all schemes meet minimum standards.
Trustees, too, must shift their focus from cost to quality. Administration should be seen not as a blocker, but as an enabler of strategic value. Good administration supports better member outcomes, enables innovation, and ensures schemes are resilient and future-ready.
Finally, we must address the talent pipeline. Administration today requires skills in technology, project management, and communication. By investing in training and promoting the varied and rewarding nature of the role, we can attract the next generation of administrators.
In my view, pension administration is having a Cinderella moment moving from the back-office shadows to become a genuine driver of value for schemes and their members.
If you’d like to know more about Brightwell, get in touch at: hello@brightwellpensions.com
