The managing director of Origo – which has been leading efforts to unite the industry behind a single vision of a virtual pension pot – has expressed concern about the Department for Work and Pension’s reluctance to confirm whether it will provide state pension data for the initiative.
Paul Pettitt said his company, which has secured the backing of major pension providers to create technology which would link their system to a dashboard, said the inclusion of the state pension was crucial.
“One of the key things for the dashboard to be valuable for the consumer is being able to show state pension data.
“For a lot of people the state pension might be their biggest source of income in retirement and if you have got a dashboard that only shows some details of DC or DB savings and nothing else, people might make decisions which might be different if they had also seen their state pension income.”
Ministers have backed giving savers a virtual view of all their pension pots across all providers and schemes - known as the pension dashboard - rather than actually transferring pensions into a single policy, as would have been the case for a pot-follows-member proposal.
Recommendations in the Financial Advice Market Review’s final report set a 2019 target date for the creation of a pension dashboard, but the government has said industry must be responsible for delivering this and not the state.
Mr Pettitt said there is “a coalition of the willing” but added there is also a lack of engagement at the moment from ministers.
“At the moment the Department for Work and Pensions is quiet on the subject.”
Origo has secured the backing of providers such as Aegon UK, Aviva, Axa Wealth, Just Retirement, Legal & General, Prudential, Royal London, Scottish Widows, Standard Life and Zurich to help them deliver the pension dashboard.
Last month, the Tax Incentivised Savings Association also came out with a pension dashboard proposal, based on its existing Tisa Exchange (Tex) system, causing some debate as to which model would win out.
Under Origo’s proposed solution, Mr Pettitt’s company would act as an intermediary for data between companies offering a pension dashboard and providers.
Mr Pettitt said that if pension dashboards went straight to each pension provider it would push up its cost. “Let’s make this as cheap as possible for consumers,” he said.
Phil Stevenson, Chartered financial planner at Cheshire-based ARK Financial Planning, said the dashboard will “absolutely fail” without state pension data.
“For the larger part of the population the state pension will be the biggest part of their retirement income. And those people tend to be the least sophisticated in terms of financial planning,” he said.
“A pensions dashboard is a great idea, but like all these things the output is dependant upon the input. I think the practicalities of that may make it an insurmountable problem for all but those with simplest career/ pension track records e.g public sector.”