The inclusion of the pension dashboards among the announcements in the Queen’s Speech on October 14 was an important step forward for this initiative, reflecting support from the government and enabling the industry to move forward to deliver dashboards with renewed vigour and certainty.
While it has been pointed out that a lack of government majority in parliament means the proposals contained in the pensions bill might not necessarily all go ahead, pension dashboards have crucial cross-party support as well as champions within the Department for Work and Pensions, including pensions minister Guy Opperman, who have made it clear that dashboards are essential to those approaching retirement.
An ageing population and increased life expectancy, the shift to defined contribution pensions and the increased pressure on state pension provision, mean individuals must now take on greater responsibility for saving and investing for their retirement years.
People need to know what pension savings they have and where they have them, along with guidance on how to prepare for retirement with greater confidence.
The Association of British Insurers has estimated the average person could have 11 jobs over a lifetime.
The success of auto-enrolment has led to millions of new pension savers and a proliferation of pension pots.
- The pensions dashboard was given the go-ahead in the pensions bill
- The Money and Pensions Service has taken responsibility for the dashboard
- Master trusts and larger DC schemes should be onboarded first
It is very time-consuming for an individual to obtain a simple overview of what they have, where it is and what it is worth – the basic information required to plan for retirement.
Yet, the current generation of savers wants control and has high expectations, given positive online consumer experiences outside of pensions.
Hence it is not just those approaching retirement who need dashboards.
Access to a dashboard will be ever more critical in the years ahead as individuals building their pension pots take greater responsibility for their retirement future and as the state pension is moved further and further up the age range.
Money and Pensions Service
It is encouraging that the Money and Pensions Service has taken responsibility for delivering pension dashboards and established the Pensions Dashboards Industry Delivery Group to take things forward.
In his comments at the time of the Queen’s Speech, Chris Curry, principal of the PDIDG, said compulsion was a “crucial next step in delivering trusted dashboard services”.
In addition to providing for a framework to support pension dashboards, the pensions bill includes new powers to compel pension schemes to provide accurate information to consumers.
This, the document said, “will include provisions for the regulators to ensure relevant schemes comply”.
What was not mentioned in the Queen’s Speech was inclusion of the state pension information, although the DWP has said previously this will need to be part of an individual’s dashboard information.
Industry work on the pension dashboards has been ongoing for the past five years, and fintech company Origo has been heavily involved in progressing the initiative.
To see government policy taking dashboards through to the final stage where they can become reality for individual pension holders, and to see the crucial work undertaken by the industry to deliver the first dashboards come to fruition, is hugely gratifying.