The pensions industry has started to trial pension dashboard models and more are expected to be tested next year, according to the department for Work and Pensions.
In a statement published this morning (October 15) the DWP said: "[The bill] paves the way for Pensions Dashboards to be introduced, with the industry already trialling the first models with more expected to be tested next year."
Part of the Pension Schemes Bill announced yesterday (October 14) is devoted to the creation of a framework to support the dashboard project, including new rules to compel pension schemes to provide accurate information to consumers.
Pension dashboards will ensure people throughout the UK have easy access to information about their pensions, who manages them and what they are worth.
The bill will include provisions for the regulators to ensure relevant schemes comply, according to a briefing document published alongside the Queen's Speech yesterday (October 14).
The government confirmed in December it will introduce multiple pension dashboards, with the first one being developed by the government's new guidance body, the Money and Pensions Service.
An industry delivery group, brought together by the guidance body, will set out a timetable for other fully operational dashboards, as well as setting standards and ensuring security across the portals.
Gregg McClymont, director of policy at The People’s Pension – the second biggest master trust in the UK - welcomed the new rules for the pension dashboards, but warned there remains “a package of measures necessary if the public are to have confidence in dashboard”.
He said: “First, dashboard won’t work unless all savers can see all their pensions in one place. Total coverage is therefore crucial.
“Second, charges must be included from the outset to achieve transparency.
“Third, if the government continues to promote multiple dashboards it's imperative that a legal duty to operate in the best interests of savers is placed on all such operators.”
The Pension Schemes Bill also includes provisions to create collective defined contribution schemes, as the document provides a framework for the establishment, operation and regulation of this new type of pension fund.
Royal Mail is the first company looking to set up one of these plans, after reaching an agreement with the Communication Workers Union and gaining approval from workers in April 2018.
The DWP stated it is considering potentially opening the option of CDC to “master trusts and multi-employer schemes at a later date”.
The bill will also bring a new sentence of up to seven years in prison for bosses who put their staff pensions at risk.
The new sanctions – which also give courts the power to levy unlimited fines – are part of the new powers given to The Pensions Regulator.
The rules will enable the watchdog to get involved more quickly and more often when companies make changes which could damage their pension schemes.
According to Thérèse Coffey, secretary of state for Work and Pensions, the Pension Schemes Bill is “the next crucial step in making the UK the best place in the world to retire”.