Master trusts and pension providers regulated by the Financial Conduct Authority will be the first schemes to provide data for the pension dashboards in 2023 but full integration could last years.
A call for input, published by the Pensions Dashboards Programme today (May 27), detailed proposals for the staging of the project.
Aiming to achieve the widest coverage of pensions in as little time as possible, staging will be divided in three waves: first, the largest schemes with more than 1,000 members will be required to provide data to the dashboards.
The second wave will include medium schemes, with 100 to 999 members, followed by the small and micro schemes, with 99 or less members.
The document confirms the timeline published by the PDP in December, which aims to roll out the project in 2023 but said full coverage may not achieved until 2025 or beyond.
The PDP officials said they considered the proposed approach to be “ambitious”, having the potential of covering 99 per cent of pensions “in scope for dashboards within two years from the first staging date”.
George Currie, consultant at LCP, who until December 2020 was seconded to the Pensions Dashboards Programme, said even that timetable may be challenging.
He said: “The PDP’s timeline for onboarding pension schemes and providers to the dashboards ecosystem is undoubtedly ambitious and even 2025 looks challenging.
"If it delivers find and view functionality for the vast majority of pension entitlements by 2025, this will be a remarkable achievement. However, the scale of preparation required in a relatively short space of time by so many schemes, with vastly different types of entitlement, will be a significant challenge for schemes, who will have to update – and in some cases revolutionise – data management and governance processes to ensure compliance with the timeline.
"Equally, this timeline is dependent on the successful development, testing, and roll.out of the digital architecture of the dashboards ecosystem by the PDP over the coming 18 months, a challenge in itself that should not be underestimated”
Under the plans, the first wave will commence in April 2023, running up to two years, starting with master trusts and FCA regulated providers.
Defined contribution schemes used for auto-enrolment will be the next ones being asked to share their data during that year, while all remaining occupational schemes with more than 1,000 members will follow.
The document also revealed that the Department for Work and Pensions is working with HM Revenue & Customs to “ensure that the infrastructure required to provide state pension information will be in place ahead of the first publicly available dashboard”.
The call for input detailed that wave two will not commence until the bulk of large schemes have successfully connected, which is unlikely to happen before 2024.
Timing for wave three should be determined in line with the ISP market forming, the document stated.
According to Darren Philp, director of policy at Smart Pension, the proposed staging was “sensible" but "ambitious" as " there is a lot of work for schemes to do to prepare for the dashboard, but the pieces of the jigsaw are slowly falling into place, which is great news all round”.