Pension Dashboards are being created to enable savers to access all their pension information online, securely in one place.
In January the Money and Pensions Service (MaPS) established Pensions Dashboards Programme team released a timetable by which schemes will be required to provide data to the new dashboards, and the draft Pension Dashboards Regulations which will come into force from next year.
Our latest insight article takes a look at the dashboards, and what their introduction will mean for providers, advisers and scheme members.
With record numbers of people saving for retirement following the introduction of auto-enrolment, the government identified the problem that many savers were finding it difficult to keep track of multiple pensions.
In 2016 in answer to this problem, the government began the development of a publicly-owned dashboard service to form part of a comprehensive retirement planning hub.
These fully-inclusive retirement hubs will include all pensions data including the State Pension, defined benefit pensions, workplace pensions, personal pensions and SIPPs.
In 2019 the government introduced legislation compelling schemes to provide data for the pension dashboards, taking the dashboards from a theoretical project into the start of a working project.
Soon after, it tasked the Money and Pensions Service (MaPS) with developing the central architecture needed to make pensions dashboards a reality.
This January Guy Opperman MP, Minister for Pensions and Financial Inclusion, described the dashboards as an essential part of the government’s plans to “modernize the pensions industry and make it fit for the 21st century digital age”, as he introduced the draft legislation giving detail to how providers will share this data.
The idea is that pension dashboards will provide clear and simple information on savers’ multiple pension savings, helping them better engage with their retirement planning and reconnect with any lost pension pots.
However, the development of such dashboards has been a mammoth task for both the MaPS’ Pensions Dashboards Programme (PDP) and for the industry.
Since they were first announced in 2016, the dashboards have faced numerous delays leading to frustration from many workplace pension providers.
Originally the first dashboards were predicted to be live from 2019, however the recently-shared staging dates from the PDP showed that some schemes will not be required to provide data to the dashboards until 2026.
Whilst dashboards are a simple concept, the delivery of them is complex and reliant on collaboration between the PDP and organisations across government, regulators, technology providers, pension schemes and retirement product providers.
To make the dashboards work, these parties need to be connected to the dashboards themselves, data providers’ find and view interfaces to the ecosystem, and the central digital architecture.
The PDP has been made responsible for delivering the central digital architecture and services, to enable data providers (including workplace pension providers and schemes) and dashboard operators to interface with one another.
There will be no central database within the ecosystem which holds personal information from savers or providers, instead the ecosystem will function like a switchboard, connecting savers with their pension information via dashboards.
In order to make the pension dashboards work, workplace pension providers will have legal requirements in respect of connecting to the dashboards ecosystem in order to provide pensions information via dashboards.
The government published the first draft of the regulations to govern the relationships in January, with the consultation to close in March.
Workplace pension providers will have to register interfaces (find and view) with the PDP governance register, register software with the consent and authorisation service, and comply with PDP service standards, specifications and technical requirements including security, notification and reporting requirements.
They will also have to comply with the find and view interface standards set by the PDP, and implement the user managed access specification.
When it comes to receiving and responding to find requests, workplace pension providers will need to receive find data from the pension finder service, register an automatic receipt (within a set time limit), run an internal search, if a positive match is found then the provider must register a PeI token and store view data for subsequent access by user at dashboard (within set time limit), and if a partial match is found it must register a PeI token inviting the user to contact the provider directly via email, phone or web form. Any data received as part of the find request should be deleted once a match has been either made or not found.
When it comes to receiving and responding to view requests, workplace pension providers will have to provide view data so that it can be returned to dashboards, generate the data if the view data doesn’t already exist (including any calculations), check view requests permissions against the consent and authorisation service, and if authorised, retrieve view data from internal systems and transmit to dashboard.
Providers can delegate their find and view functions to a third party administrator or software provider.
Most providers have already begun to undertake preparatory work for staged onboarding with the dashboards, with the initial technical guidance shared by the PDP towards the end of last year.