Pension schemes able to communicate with members electronically from 1 December

A draft regulation from the Department of Work and Pensions (DWP) that allows pensions schemes to communicate with members electronically comes into effect on 1 December 2010.

Following a public consultation exercise between 6 January and 1 March 2010, a number of changes have been made in drafting the Occupational, Personal and Stakeholder Pension Schemes Regulation 2010, including facilitating the use of electronic means of communication by these schemes.

Carole Ward, a partner at Barnett Waddingham, said: “Easing the restrictions on using electronic communication to correspond with pension scheme members is long overdue and will be a bonus to those schemes who have adopted the The Pension Regulator’s guidance on record keeping and found addresses for all their missing members.

“But the legislation could also be fraught with risk if schemes use email to communicate important information. There are major issues around maintaining current email addresses and emails arriving safely as well as the security of the information that is contained.

“We will recommend to our clients they use password-protected access to a secure website to inform members about their scheme and any important changes. This will achieve all the benefits in terms of cost savings and other efficiencies but at the same time ensure confirmed delivery and security of information.”

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