The recent announcement that the launch of the new Pensions Dashboard is being delayed until 2023 is disappointing although it is good to now have a commitment to a delivery plan, as now, perhaps more than ever before, Britain’s savers need to have the most accurate handle possible on the state of their finances. That’s the view of Ross Laurie, CEO of Visible Capital. Below Laurie explains how he believes that a new tool being developed is well placed to support the advice profession.
“The Pensions Dashboard, a digital interface that enables people to view all their lifetime pensions in one place, was the brainchild of the FCA and subsequent development has been the responsibility of a group of experts, the Pensions Dashboards Programme.
However, citing the complexity of the initiative and the multiple parties and technical services which need to be connected to make the dashboard work, the Pensions Dashboards Programme has just announced that the initial 2019 launch has now been pushed back four years to 2023.
Whilst it is obviously important that the Pension Dashboard is comprehensively populated by the UK’s pension providers and that the robustness of its functionality is tried and tested, another three years is a long time to wait, especially for savers with retirement in their sights.
According to an FAMR survey in 2018 by the Financial Conduct Authority, only 1 in 10 adults were taking regular financial advice, leaving 91% or 46.5 million people without the benefit of regulated financial advice.
It is my calculation that the figures are roughly the same today. I also believe that the availability of the Pensions Dashboard would most certainly have been a springboard for this, currently unadvised, sector of the population to use the tool to review their pension pots and for many savers to then go on to seek helpful, possibly transformative, financial advice.
Our team at Visible Capital is hugely supportive of the work of the Pensions Dashboard initiative and appreciate the complexity of the project. However, in a market where auto-enrolment means that people accrue many more pension pots than in the past – on average 11 policies in a working lifetime – and where £19.4 billion is stashed away in unclaimed pension pots, it is imperative that savers can put their finger on exactly where their pension pots are and what each pot is worth. Only then will they be able to calculate exactly how much their annual pension provision would be.
Given the real urgency of the situation, Visible Capital has been pushing through the development of a pensions tool for the adviser market. As an independent fin-tech company we have the benefit of being able to operate with speed and agility and to take advantage of existing regulation and technology as well as existing platforms we have already developed.
Given these opportunities we have moved forward to partner with not-for-profit industry standards upholder Origo, in order to launch a fully functioning pensions finder product, before the end of 2021. We have the agreement of 9 of the UK’s main pensions providers to work with us and to provide the data to populate the tool. Our tool will be launched to the UK’s IFA network of firms and individual consultants and we are confident that they will be able to provide their customers with access to up to 75% of their pension assets. Whilst this is not perfect, it is in line with the Pensions Dashboard Programme’s forecast of functionality in the early days of the initiative’s launch in 2023, and over the course of 2021 we will be massively extending our product’s scope and functionality in response to the MAPs UK Strategy for Financial Wellbeing, in particular the Nation of Savers Agenda.
When we interviewed financial services entrepreneur and futurist Ian McKenna recently on our VCTV channel, he referred to the acceleration of the technology revolution during the pandemic and suggested that in the UK we have seen as much as five year’s worth of change in just a handful of months. “Necessity is an amazing driver”, he said.
We couldn’t agree more in this case and while we look forward to the 2023 launch of the national Pensions Dashboard, we hope to onboard more of the UK’s major pension providers and roll out our new pensions functionality to interested IFAs in the next weeks and months. We have the will and technology to make it happen and believe there is a real necessity for such a tool in a time of such extensive financial uncertainty.”