A survey of an audience of pension scheme trustees, lawyers and pension managers reveals that a huge amount of work will be needed if schemes are to be ready for pensions dashboards. At an industry webinar hosted by consultants LCP earlier this week, attendees were asked if they had prepared a pensions dashboard ‘project plan’. Just 39% said that they had, with 42% saying they had not and a further 19% who did not know. With larger schemes being expected to connect to the Pensions Dashboard ‘ecosystem’ by this time next year, the lack of planning could lead to a serious capacity crunch next year as deadlines approach.
Commenting on the findings, Ella Holloway, Senior Consultant at LCP said: “It was surprising to see that so many schemes were yet to come up with a project plan for dashboards. Whilst momentum had stalled while the government re-set its timetable, it is now ‘full steam ahead’. Schemes should now know the date by which the government expects them to connect to the dashboards ecosystem, and the backstop deadline of October 2026 will be upon us before we know it. There is no doubt that the secret to making dashboards as painless as possible is planning, but many schemes clearly have a long way to go with dashboard preparedness. We are happy to help any scheme put together a plan to make sure they can meet their dashboard obligations on time.”
Also discussed at the webinar was how schemes will connect to the dashboards ecosystem. Options include connecting directly (typically in the case of the largest schemes) or using a specialist ‘integrated service provider’ or ISP to help manage the process. Attendants were asked about their plans, and just over one third were planning to use an ISP and around 11% were building their own solution. However, just over half (54%) of those attending said they did not know how their scheme would connect.
Commenting, Marcus Renouf-Allen, Senior Consultant at LCP said: “Thousands of schemes will need to connect to the dashboards ecosystem, and a decision on how to do this needs to be made sooner rather than later. For smaller schemes in particular, it is likely that they will want to use the services of a specialist ISP, and there could be a rush to sign up to ISPs as deadlines approach. To avoid being a victim of a capacity crunch, schemes need to finalise their connection plans as soon as possible.”
A wide variety of questions were tabled, with particular concerns including how schemes going through a buyout process with an insurance company should think about their dashboard duties and whether trustees would have much freedom when it came to designing their own criteria for ‘matching’ dashboard users against scheme membership lists.
LCP also highlighted that there was a risk of a ‘Martin Lewis effect’ at the initial launch of dashboards, with millions of people prompted to search for lost pension pots all at the same time. Schemes were warned of the need to put in place ‘surge capacity’ to avoid being overwhelmed with inquiries, as well as readying themselves for more interest in pension transfers and consolidation once dashboards go live.
