The STAR initiative, to improve the outcomes for individuals wanting to transfer their assets such as pensions and investments, has reached a significant milestone. The Implementation Phase of the Initiative started in March 2020, to allow the members to agree an approach to deliver STAR Reporting and an opportunity to discuss change requests and common challenges they may face.
The Steering Groups that are part of the effective governance of STAR have been meeting monthly. The GIA/ISA work stream and Individual Pensions & SIPP work stream process workshops are complete and the proposed SLA/MI requirements are agreed. This has been approved by the STAR Steering Group, chaired by Tom McPhail, of Hargreaves Lansdown. The Occupational Pensions and Asset Manager work streams are also nearing completion.
This progress means that the initiative enters its next phase with the formulation of the Implementation Group. The remit is to:
- Establish what Transfer Process MI is available to report now
- Establish how much of the proposed Reportable MI could be delivered with “quick win” processing or system changes
- Establish an appropriate approach and timeline to deliver the full MI
STAR Working Group members have created Process Capture Documents covering each of the Product Groups within the scope of the STAR Initiative alongside a Working Group looking at those Process Steps owned by Asset Managers or Transfer Agents.
In December 2019, the Financial Conduct Authority (FCA) confirmed it was happy with the progress made by the industry through the STAR initiative. The FCA will continue to monitor the initiative in 2020 and consider further action if necessary. The FCA has encouraged firms not already involved in this initiative to consider taking part as a way of improving the switching process and achieving better outcomes for consumers.
A growing community of 55 firms have signed up to the STAR initiative, which officially launched in January 2019 and has companies and organisations committed to shaping recognised, industry-wide standards to promote good practice in transfers. The STAR initiative is the only cross-industry solution bringing together platforms, providers, life companies and transfer/asset managers. The STAR initiative is galvanising the industry, to create the long-term solution to improving customer experience of transferring savings and investments between companies, by setting and measuring against a best practice framework.
During 2020/2021, STAR will start to collect and publish the performance of companies when executing transfers, which will provide regulators, customers and their financial advisers with clear evidence of a commitment to improve their performance. This will in turn create a competitive advantage for organisations leading the industry with STAR.
The STAR remit is clearly defined and will:
- Define the processes required to complete a transfer
- Specify good practice targets for each of those processes
- Measure, recognise and accredit performance excellence across the industry
The output of the STAR initiative will be a quarterly industry index and an annual accreditation scheme of bronze, silver and gold so that performance can be evidenced and rewarded.
Tom McPhail, Hargreaves Lansdown and Founding Chair of the STAR Steering Group
“STAR is a voluntary framework and has achieved rapid legitimacy and momentum, due to the significant organisations participating representing a cross section of the financial services industry. We have made significant progress. The last year has been an intense period of work and the intellect of the industry have put their heads together to drive forward this truly cross-industry solution. Accreditation is just around the corner, and as an industry we have made significant progress. Not only will this initiative improve things for customers, but it will allow participating organisations to be more efficient and save money in the process.”