Case Study: Scheme Secretarial - Moving to a New Provider (Pegasus)

Scheme background

The Scheme was a long-standing client of LawDeb Pension Trustees and we had chaired the Trustee Board since 2010. Scheme secretarial services were delivered by a large third party provider who also managed the scheme administration. The Trustee Board is cost-conscious and the providers services were keenly priced.

The issue

Whilst the service had been good, after six years with the same scheme secretary there was a change in personnel, followed by a further two changes in the space of two years.

As well as being frustrating for the trustees, there also followed a significant reduction in the quality of service. The secretary was relatively junior and therefore had to have all decisions signed off internally, which led to a build-up of unfinished tasks. There was also ineffective communication between the scheme secretary and administrative staff.

The trustees, who had been keeping the provider under review, decided that enough was enough.

The solution

The Board had decided to look for a new provider that they could trust and to whom they could delegate. The LawDeb Chair explained that, as LawDeb is also a provider of secretarial services he was conflicted but that the Board should go ahead and explore this option.

The trustees made the decision to consider LawDeb for the role and asked for a scope of services that explained our fixed fee for core services. Within a few days LawDeb had provided the document outlining an improved service with no increase in fees.

This information, its swift provision and LawDeb’s reputation for quality meant that the trustees were happy to appoint us, with the Chair absented.

The outcome

Upon appointment LawDeb was put in touch with the outgoing Scheme Secretary to begin the handover. The first trustee meeting was only a few weeks later and the team were keen to ensure they were prepared.

Despite their best efforts there was virtually no handover information provided from the outgoing scheme secretary and the LawDeb team had to work with the Chair to ensure that no actions were missed and that the Board meeting packs were suitably prepared.

After the first meeting the Chair received unsolicited praise for the new secretary with three areas of improvement mentioned:

• Information now arrives in good time for meetings
• Everything is more thorough with each paper having a memo with action points attached
• Electronic copies are available free of charge (the previous provider had proposed charging thousands for this service)

The improvement in service has no doubt freed up the Chair's time as he is comfortable delegating tasks and everything operates more efficiently which will ultimately lead to a cost-saving for the scheme.

Key learnings

1.Do not underestimate the impact poor service can have on the running of a scheme

2.Whether a trustee or incoming provider, if you push for one piece of information from an outgoing provider make it the list of outstanding tasks. This ensures that you don’t start on the back foot and can prioritise effectively.

3.Do not rule out providers due to concern over conflicts, by putting in place effective measures, be it absenting yourself or getting third party approval of appointments and invoices you can mitigate the issue.