WHAT’s YOUR SCORE?

In the world of pensions administration, there’s a new game, and those who score low points are being “named and shamed” in the press.

The scorekeeper of this new game is the Pension Funds Adjudicator (‘PFA’),  Mamodupi Mohlala.  Having announced the results of the first scorecard on the 28th September,  she worked her last day in the Office of the PFA on the 30th and moved,  as planned, to another job the following day.

She leaves a somewhat perplexed community of pension administrators behind her.  Before leaving, she reported the 20 worst performers to the FSB (Financial Services Board).  Many of them have indicated they wish to meet with her to clarify the areas of alleged underperformance,  but alas, she is no longer in office to accommodate these requests.

The Minister of Finance to whom she reported has not even advertised the vacancy as yet.

While her Office processed the largest number of complaints in its 10 year history during her term of office, there are still thousands of cases unresolved, and the gap left by her departure will only serve to worsen an already critical situation. Overseas PFA offices receive substantial more funding and have large staff complements to do volumes of work far less than that done in SA.

Lest some adventurous advertising copywriter attempt to crow about his client’s high scores, please be aware that an administrator would be ranked on the scorecard only if a complaint had been lodged against it. 

The method of scoring is also causing concern in that, even if the complaint was totally misplaced (for example, directed at the wrong administrator), a poor score could be given should the administrator not respond adequately or timeously to the complainant.  Frivolous complaints or complaints relating to perceived entitlements arising many years ago might also result in a poor score if prompt responses were not given, despite the administrative difficulties in accessing records from archives and investigating historical facts.

Waiting periods specified in the rules of some funds might have caused legitimate delays in making payment, yet this fact was not necessarily taken in to account when awarding points.

So what is to be made of all this?  Do we simply shred the report on the grounds that the term has ended and we can all go home?  While many argue that the scorecard is deeply flawed, the real point which the departing Adjudicator wanted to make is that the pension fund administrators need to adopt a much more consumer-friendly approach to their Fund members.

If at the start of the new term the administrators have learned that business is all about communication, then the scorecard would have served its purpose, and the Adjudicator would have achieved something worthwhile for the thousands of Fund members who entrust their retirement provision to the pension funds and their administrators.

Clive Hill  | Financial Services Manager