Firing Line: Paul Pettitt

The provider-owned organisation, which has just spun out a new governance body, Criterion, brings interested parties together to sit in a room and thrash out common ways of "moving data around" – and they have to leave their competitive instincts at the door.

Mr Pettitt said: "We make sure at every meeting we put an agenda on the screen. The first thing in there that goes up is the Companies Act rules. If you break them then you will be asked to leave the meeting."

The rules are actually very strict. There must be no talk of pricing, or strategy or future plans; all specifics about business plans must be kept generic and there are not allowed to be any side meetings. If one person brings up some commercially sensitive information in the room, everyone else who hears it is implicated in the misdeed, so Mr Pettitt and his team have to keep a close hold on what goes on.

He said: "With organisations who might be a bit more aggressive in what they're trying to achieve, we have to stop them."

Mr Pettitt has been with Origo for 28 years and during his time he has seen the development of straight through processing and the launch of a prototype of the pensions dashboard.

Over that time, the 60-strong organisation has not changed much. Mr Pettitt said the driving force was to: "Help the industry move data around to manage the risks of that and make the process more efficient, and the culmination of that should be better customer outcomes."

An early example of Origo working for the industry was the development of technology that allowed advisers to reconcile commissions that need to be received from providers. The problem was that advisers were dealing with 30 or 40 providers, all with their own systems and own way of doing things.

Origo helped set up a standardised commission-based system for providers to talk directly with advisers, to reconcile payments. He said: "We quickly developed some standards so a number of parties could deliver the same service. There is a set of regulations that require providers to deliver secure information to the customer. We looked at the regulations, and what process needs to happen." 

It was established what data needed to be sent backwards and forwards. Mr Pettitt said: "All of that is defining a straight through processing so that computers can do that without anyone having to interpret it."

The impact in terms of cost saving was obvious, said Mr Pettitt. He added: "[With 30 or 40 providers doing it differently], providers were saying that isn't sensible, whereas if you collaborate you can do it for a lot less – and lower risk and deliver a better customer outcome. If they all deliver commission reconciliation in the same way, they don't need a department of 40 people trying to do it."

The pensions dashboard was also the invention of Origo, according to Mr Pettitt. He said: "We were asked by our board to have a think about whether there were areas in the market that didn't operate very well and could be more efficient, and whether there could be anywhere where we could improve things."

Pension freedoms had just been announced and it was on the radar, so suddenly accessing one's pension became a lot more complicated – with partial pension drawdowns while working possible, and the need to make different decisions throughout one's retirement.

Mr Pettitt said: "Individuals are going to need some advice about that to make sure it's tax efficient. But all of that could be completely irrelevant if an individual doesn't know what pension savings they have. Can you answer the question: where is it and what do I have?

"If you lose track of it, how are you going to maximise your income in retirement? You won't even be able to get advice because an adviser will say: where is it and what's its value?"

The working group started with just a handful of providers and quickly grew to 30 or 40 organisations, which all believed in the idea, so a dashboard prototype was built; the ABI has got involved and HM Treasury has asked the industry to deliver something by 2019.

The arrival of automatic enrolment means that in 20 years' time there will be "millions" of pensions pots, for which the pensions dashboard is an obvious solution. The "plumbing" is already there for creating the system. 

Mr Pettitt said: "A bunch of providers who have been delivering valuations to advisers' CRM systems think a request for data for a dashboard isn't really very different. If you're a provider you can just track that straight back."

There has been a bit of resistance over what to include on the dashboard; there are various options up in the air. However, Mr Pettitt said, it makes much more sense to put the state pension and DB entitlements on as well as the DC scheme, so an individual has an accurate picture of what his situation is and can act accordingly.

There are more philosophical issues relating to the emphasis to place more responsibility in the hands of the individual. It might make people more engaged with their finances, but, Mr Pettitt said: "There are bigger questions about longevity risk, because an individual has far less ability to manage that individually rather than collectively."

Developing collective DC schemes might be the answer.

While Mr Pettitt has been a driving force at Origo for 20 years – he was its first employee and he has been in the hot seat since 2003 – he is only 54. Many executives would just be getting into their stride at that stage in their career.

Following retirement, he plans to do some travelling and intends to pick up some non-executive directorships. He is unlikely to be away for long.

Melanie Tringham is features editor of Financial Adviser

Paul Pettitt career highlights

2003 – present: Managing director of Origo

2000 – 2003: Managing director, Origo Standards

1998 – 2000: Operations director, joined the main board

1995 – 1998: Strategic research manager

1989 – 1995: Joined Origo as assistant marketing manager