Continuing from Tuesday, our latest insight article takes look at the dashboards, and what their introduction will mean for providers, advisers and scheme members.
Under the draft regulatory framework published in January, workplace pension providers will also have to adhere to governance standards including deleting users’ data related to the ecosystem on request or after a significant period of non-use, and meet the regulatory and monitoring requirements set out in the draft dashboards legislation published in January.
The reporting standards under the draft legislation include providers need to report to the PDP on the total number of view requests, complaints and queries, and the total number of times data was not available on the dashboard within “a timely manner” to monitor schemes which are “unable to provide values in a timely manner”.
The PDP is working with The Pensions Regulator, the Financial Conduct Authority, and the Department for Work and Pensions to finalise the reporting standards which it says will facilitate the smooth ongoing connection to the dashboards ecosystem.
Whilst workplace pension providers are under a legal obligation to provide the necessary data, they will not have to verify the identity of dashboard users requesting the information. This falls under the duty of the central digital architecture’s identity service.
When a user asks a dashboard to find their pensions, the consent and authorisation service within the PDP’s central digital architecture will check whether the user has already verified their identity, if they have not, they will be passed to the identity service to do so.
This service will follow a five-step process to establish the strength of the identity claim, with only those who are rated at a medium level or above being allowed access to the pensions information.
They will also not have to provide user interfaces or obtain any user consents for processing identity data to search internal records or to return pensions information to the dashboards.
The government-backed PDP is designed to deliver comprehensive online pension hubs to millions of UK pension savers, but the latest staging dates shared by the PDP show that some schemes will not be required to provide data to the new dashboards until 2026.
This means that until 2026, pension savers will not get the truly all-inclusive picture the dashboards were designed to provide.
State Pension details will be available on the dashboards from ‘day one’ when they ‘go live’ with the ecosystem opening to dashboard providers in April 2023.
Large pension schemes will be required to provide data to the dashboards between April 2023 and September 2024.
Medium-sized schemes will be brought into the dashboards between October 2024 and October 2025.
Small pension schemes will not be required to provide data to the dashboards until 2026.
Whilst these are compulsory staging dates, schemes will be able to undergo an early volunteering onboarding process this year.
The PDP has also selected its first three pilot commercial providers to help with testing and development, one of whom is workplace pension provider Aviva.
Aviva will be helping the PDP refine the onboarding process for dashboard providers as well as testing design standards and technology.
Its six-month test phase began running in December and will help the PDP prepare to connect its dashboards to a “central digital architecture”.
Last year the government committed to make the provision of pensions dashboards a Financial Conduct Authority (FCA) regulated activity, through amendments that HM Treasury will make to the Financial Services and Markets Act 2000.
Therefore, organisations wishing to become pensions dashboard providers will soon have to apply for FCA authorisation and adhere to FCA conduct rules.
The Pension Regulator (TPR) and the FCA will also regulate the compliance of pension providers and schemes in providing data to individuals via their chosen dashboard.
The majority of workplace pension schemes will fall under the FCA, which will resume the responsibility of monitoring the compliance of personal and stakeholder pension schemes.
TPR will regulate trust-based and public sector pension schemes.
Clarity around the final expectations the regulators will have of schemes and workplace pension providers are expected to be published later this year.
Currently, the vast majority of preparation work for the implementation of the dashboards has fallen on the PDP, regulators, dashboard providers and pension providers.
Advisers have yet to be given any legal duties to provide any information for the project.
However, when pension dashboards do go live they could prove a useful tool in helping clients track down any lost pension pots.
Scheme members and employers are also not required to do anything to prepare for pensions dashboards.
When the dashboards go live, it could provide an opportunity for employers to engage with their workforce around pensions, making their workers aware of what the dashboards offer and how their workplace pension can form a valuable part of their remuneration from their employer.
Many scheme members may also find themselves engaging with the dashboards without prompting by their employer or adviser when they go live and potentially look to make changes to their retirement planning based off what they find.