Pension Dashboard  

Pension dashboard participation must be compulsory: PASA

Pension dashboard participation must be compulsory: PASA

All pension schemes must be forced to provide information to the pension dashboard by 2021, Margaret Snowdon, chair of the Pensions Administration Standards Association, has said.

Ms Snowdon, one of the most prominent voices in the UK pensions world, said the industry should be given a period of time to prepare, but that eventually compulsion would be "inevitable".

Currently, the pension dashboard is a voluntary initiative, overseen by government but paid for and carried out by the industry.

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It aims to allow consumers to view all their pension pots on a single website.

Ms Snowdon, who is one of the two independent members of the pension dashboard's official steering group, warned that the current status quo could only go so far.

"There will be some schemes that decide for whatever reacon that they don't want to participate, and I think that would be very bad for the industry, and it would be very bad for UK PLC," she said.

However, she insisted that a "period of grace" was necessary to give older, less high tech schemes time to update their systems.

"Trying to do it too soon might force people to fail for the wrong reasons," she said, adding that it could result in sub-par systems.

In the meantime, Ms Snowdon said the government could incentivise schemes to prepare by granting VAT exemptions on work carried out to update their systems.

She said she believed the government would be open to introducing compulsion, but added that as yet the issue had not been discussed by the steering group, which she said meets every six weeks.

Last week, it emerged participating pension providers were contributing £50,000 each to fund the creation of a prototype.

The prototype, which will not be available to the public, is due to be unveiled to the government in March.

Ian McKenna, director at F&TRC and the other independent member of the pension dashboard steering group, agreed that compulsion was "absolutely" inevitable.

He said any pension provider who believed they would be exempt from providing "comprehensive and exhaustive information" to a dashboard was "living in cloud cuckoo land".

He went a step further, saying: "Any pension provider that doesn't have a dashboard by 2019 will have made a sub-conscious decision that they are closing down."

He said compulsion should be in place for most schemes by 2019, but conceded that some defined benefit schemes might need an extra two years.

He said he believed the government was already working on the assumption that compulsion would be necessary.

Mr McKenna added that the dashboard would make financial advice much cheaper, because it would remove the cost of tracking down a client's disparate pension pots.