IBM portal gets 5,000 sign-ups as scheme goes paperless

Schemes are increasingly moving towards using online portals as a method of cutting costs and improving member engagement. The portal, known as MyPension, allows IBM scheme members to undertake the following tasks:

• Review pension transactions and switches;
• Check their fund balance;
• Change their investment elections;
• View their most recent benefit statement online;
• Update information on their beneficiaries.

MyPension forms part of a larger move by the scheme towards a paperless strategy. Members who opt to go paperless can also access members’ reports, summary funding statements and other announcements online.

“We’re going paperless to reduce the amount of paper wasted, issue documents faster and reduce our printing and postage costs,” said the scheme in a message to its members.

Last week Pensions Expert reported West Midlands Pension Fund had attracted 200 employer users from 70 individual employers in the first six months of its portal being launched.

Reform incentive

Auto-enrolment is fuelling the growing industry by forcing schemes to address both the way they manage existing members and how they will introduce new members to the complexities of their schemes in a cost-efficient and effective way.

Some portals include functionality to process payroll data for auto-enrolment, calculating who is eligible and contacting them with information about the process. This aims to decrease administration costs and time spent by the scheme.

Automation of this kind allows members to access information about their scheme independently, which communications specialists say is a key part of improving engagement.

“Self-service is a growing part of benefit management,” said Louise Harris, head of client communication for Capita Employee Benefits. “The trick is to have everything [member and scheme information] available.”

Workplace reform is also introducing some employers to online portals for the first time as they look for a way to meet their legal obligations.

Harris said one client who had introduced a fully integrated online benefits tutorial saw engagement reach around 85 per cent of employees, up from an average of 25 per cent for schemes displaying pension data alone.

Philip Hollingdale, chief executive officer of Staffcare, a software company specialising in online benefits portals, said: “A lot of companies are currently implementing our software just to deal with their pensions, but over time we’re expecting they’re going to want to start adding all the other benefits.”

Portals can also be a useful educational tool for scheme members preparing for retirement, with modelling tools helping them to understand the importance of adequate contribution levels and additional voluntary contributions.

Proper financial education is seen as crucial to keeping auto-enrolment opt-out rates low. Opt-outs from larger employers have been well below the official projections of around 30 per cent, although some industry figures think this rate will rise with increases to required contribution levels.

“The individual contribution is so small you will see more opt-outs when contributions rise,” said Matt Duffy, head of online consultancy at Lorica Employee Benefits.

“The next 12 months are where we’re going to be able to build up some data about where the market is going,” he said. IBM declined to add further comment.

Cheshire Pension Fund began using email alerts in August 2012 to communicate details of Local Government Pension Scheme reforms and auto-enrolment in a bid to control costs.

In February 2013 the British Airways pension fund started sending general information electronically, with 700 members signing up.