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”.
Possible delays to timeline?
Despite announcing the staging details, the PDP call for input did not include a due date by when all schemes will be sharing data with the dashboards ecosystem.
Philp noted that “while it makes sense for smaller schemes to stage later, we need to ensure that there isn't undue delay in delivering comprehensive coverage if the dashboard is to achieve its potential”.
Nigel Peaple, director of policy and advocacy at the Pensions and Lifetime Savings Association, is expecting some data to be available to savers “perhaps in 2024 or 2025”.
However, given the complexity of the task, “and the fact that we do not yet have complete certainty about the data requirements, it is today too early to assess whether this timeline is achievable,” he said.
Peaple added: “Whatever the final timescale for connection agreed upon, it is imperative that nothing is done to put at risk the pension savings of scheme members. It is better to do it right, than do it quickly.”
Consultation to inform new legislation
DWP will be launching a consultation on pensions dashboards’ draft regulations, which will include rules on staging.
PDP stated that the feedback from the call for input, which closed on July 9, will help inform policy development ahead of the new legislation.
Guy Opperman, minister for pensions and financial inclusion, said: “Making dashboards available to people at the earliest opportunity is a key part of our strategy to get people more informed about and involved with their pensions savings.
“So I would encourage anyone with an interest in dashboards to feed in their views on the programme’s emerging proposals for how and when we bring pension schemes on board from 2023.”
maria.espadinha@ft.com
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