I need to declare an interest. I’m a Scheme Actuary. I like to believe that I always provide a great service to my clients. But, how do I know it is always the service that they require?
I’m proud to be part of a profession that sets the highest professional standards of honesty and integrity. It goes without saying that your Scheme Actuary will be technically proficient, but is that enough?
Even if they are getting the answers they want to hear, Trustees should feel able to challenge their Scheme Actuary. It is important to question the advice they receive so that they can satisfy themselves that their Scheme Actuary is genuinely giving the best advice for the specific needs of the scheme? Is your Scheme Actuary willing to have difficult conversations when required?
If your scheme has an Independent Trustee, they will be well placed to comment on the Scheme Actuary’s performance. They will have a view from across the wider industry, meeting Scheme Actuaries from many different firms with many different viewpoints and opinions. This will afford them a unique opportunity to compare and contrast different styles and approaches to similar issues as those encountered by your scheme.
Is the same advice being given on different schemes, when perhaps a difference in approach is justified? Is there a current “flavour of the month” or latest “sales push” that can be seen?
My experience suggests that this is not uncommon in the industry and also, that there is a tendency to put less experienced Scheme Actuaries onto smaller pension schemes. Often, it is these very schemes where tricky issues arise and a more experienced head is needed
Rising to the challenge
Nobody gets it right all the time. Scheme Actuaries should be able to accept challenges and consider alternatives that might change or enhance their original advice and better suit the particular scenarios of your scheme. Challenge is healthy and might lead to more tailored advice to achieve better outcomes for your scheme members.
More than ever, a Scheme Actuary needs to be not only technically accomplished, but also an expert communicator. This is not easy when dealing with technical subject matter, and various different legislative and client specific requirements. But it is eminently possible if trustees and their Scheme Actuary engage in open and regular dialogue about the issues facing the scheme and the best way of resolving these.