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The robot regulator: UK watchdog reveals use of machine learning

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The UK’s Pensions Regulator (TPR) has built a machine-learning tool to help it focus on pension schemes most at risk of breaching its guidelines.

Peter Jackson, head of data at TPR, outlined on a government blog how the watchdog had worked with data scientists to make better use of the “scheme returns”, TPR’s main source of pension scheme data.

Data scientists from the Government Digital Service (GDS) built the machine-learning model to “predict future pension scheme behaviour”, Jackson said.

“As we have data about pension schemes going back several years, labelled with whether they complied with the requirement to submit a scheme return, we were able to build a supervised machine-learning model that learns from our existing data and can be used to make predictions about how a pension scheme will behave,” he said.

The final model now being implemented by TPR splits the UK schemes it oversees into 30 groups.

Jackson said: “There are groups where most pension schemes are expected to make a return on time, and other groups where a large proportion of schemes are expected to be late or never make a return. This is great as we can tailor our communication strategy differently for each group: light touch when we expect schemes to make returns on time, firmer where we expect a scheme to be more problematic.”

The work can also help the regulator keep on top of other data that might not have been updated, Jackson added, such as contact details of the scheme and key people.

“Approaching our existing data in a different way also helped us focus on data quality issues like missing and dirty data,” Jackson said. “By cleaning up these issues we hope to continue to find innovative ways of improving our engagement and enforcement.”

TPR has come under pressure in the past 18 months to improve its operations, having been criticised by politicians and industry commentators for its response to the high-profile BHS pension scheme case.

The Work and Pensions Committee, a group of politicians from the UK’s lower house, late last year called for TPR to be given a range of new powers and greater resources.

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