Kate Smith, Head of Pensions at Aegon comments on the DWP’s consultation on the Pensions Dashboards draft regulations. The consultation closes on 13 March 2022.
What’s another year? Consumers have to wait until 2024 to view their pensions on pensions dashboards.
“We are finally counting down to the launch of the first pension dashboards. After years of discussions it’s definitely been more like an ultra-marathon than a sprint!
“The regulations set out what schemes need to do to connect to the pension dashboard digital architecture, ongoing requirements and the rules for providers which choose to build their own pension dashboards. However, this is just the start, more consultations will follow from the FCA setting out what pension providers have to do, including those who wish to offer their own pension dashboard, and the FRC’s consultation on more consistent Simplified Money Purchase Illustrations projections as well as technical standards set by the Pension Dashboard Programme.
“Large master trusts and FCA regulated pension providers, along with the State Pension, will start connecting to the pension dashboard digital architecture from April 2023. They will be quickly followed by defined benefit and defined contribution trust-based pension schemes, including public sector pensions, staged by membership size. The State pension is expected to be included from day one. The idea is to achieve coverage as quickly as possible by staging the largest pension schemes, by active and deferred membership first. By April 2025, within two years of the first staging date, it’s expected that 99% of memberships, both active and deferred, will be connected to the digital architecture and sharing members’ data. This will be a massive effort for all involved. Now that we have the draft regulations and the missing details, pension providers and schemes can work in earnest to get ready for their staging date.
“Although a highly exciting moment, it’s still over 800 days to go before consumers will be able access pension dashboards and view their pension data in one place online. Pensions dashboards aren’t expected to become ‘live’ to consumers until around April 2024. Although this is perfectly justifiable to deliver ‘critical mass’ of memberships, the so-called ‘Dashboard Available Point, isn’t likely to be achieved until then, it adds on another year of waiting and anticipation beyond the previously anticipated April start point.
“We’re massive supporters of pension dashboards and believe that, over time, they could be a gamechanger in encouraging people to become more engaged with their pensions. To make people sit up and take notice it’s vital that the Government and industry work together and launch a ‘big bang’ campaign promoting pension dashboards. A co-ordinated approach setting out what pension dashboards mean for people could make a real difference to the numbers signing up and actively using it to find and view their pensions, and ultimately improve better planning for later life.”