The Department for Work and Pensions has published its response to its consultation on the pensions dashboard - asking the industry to "create and test" consumer facing dashboards by the end of the year.
Key details of the government's plans - published today in its response to a consultation on dashboards - include:
- A commitment to bring forward legislation at the earliest opportunity to compel all pension providers to make consumers' data available to them through a dashboard;
- An expectation that the majority of schemes will be ready to ‘go live' with their data within a three to four year window;
- Confirmation that state pension information will not be included immediately, but as soon as possible afterwards
The government said it supported the development of multiple industry-led dashboards displaying the same basic information - noting the industry had told government that initial models will be developed and tested from this year.
A non-commercial dashboard will be delivered and overseen by the new Single Financial Guidance Body (SFGB), which will bring together an industry delivery group to set out a clear timetable and roadmap to drive progress towards fully operational dashboards, setting standards and ensuring security to protect users and their information.
Commenting on the proposals, work and pensions secretary Amber Rudd said: "With record numbers saving for retirement as a result of our revolutionary reforms, it's more important than ever that people understand their pensions and prepare for financial security in later life.
"Dashboards have the potential to transform the way we all think about and plan for retirement, providing clear and simple information regarding pension savings in one place online. I'm looking forward to seeing the first industry dashboards later this year."
The DWP said that, while it intends to introduce primary legislation to force pension schemes to make consumers' data available, it understand that, for practical reasons, it will have to be done in stages.
It said compelling all schemes to participate in dashboards at the same time is not a practical option due to the sheer volume of schemes that need to be connected to the dashboard ecosystem.
Schemes will be compelled by a staged timeline that prioritises membership and coverage - and large DC schemes are expected to be among the first in any compulsory staging although some may connect to the ecosystem earlier, on a voluntary basis.
The DWP urged schemes to "start getting ready now", particularly in terms of preparing data, and noted that it does not expect the information required initially to be complex.
This year's key priorities for the industry will be for schemes to prepare their data to be ready within a three to four year timeframe; to work with the industry delivery group on setting data standards; and offer opportunities to supply data on a voluntary basis to inform delivery. Another priority is for interested Financial Conduct Authority authorised firms to create and test their own dashboards, working collaboratively with the delivery group.
Commenting on the DWP's response, SFGB chief executive John Govett said: "We are delighted to be working with the Department for Work and Pensions and the whole pensions industry throughout 2019 to take forward the pensions dashboards.
"Our vision is everyone making the most of their money and pensions. A big part of this is equipping and empowering people to engage with their pensions, often the biggest financial investment they will make. The new pensions dashboards will play a crucial role in this, helping people make decisions about their money and pensions with confidence, so they can enjoy greater financial wellbeing throughout their lifetimes."
Association of British Insurers long-term savings and protection policy director Yvonne Braun added: "The digital retirement revolution is here at last. All the pieces are being put in place to deliver the easy access to retirement information everybody needs and that the pensions industry is so keen to deliver.
"The ABI, leading a cross-industry group of pension providers and schemes, has already put years of work into making dashboards happen and we can't wait to see these vital services in action. We're delighted to see the government committing to the necessary legislation and will continue to play our part in making dashboards a reality."
PLSA director of policy and research Nigel Peaple said: "Preparing the sector for connection to pensions dashboards will be a major undertaking and one that we stand ready to support. The government is right to acknowledge that connecting the majority of schemes may take three or four years. But the government is also right to urge the pensions industry to act quickly, in 2019, to enhance the quality of their data, and to support the SFGB in developing appropriate data standards. We look forward to working with the SFGB, the pensions industry and consumer groups to deliver this important project."
Smart Pension director of policy and communication Darren Philp said "we now need to get our collective heads down and crack on if we're to develop something that really delivers for pension savers."
"While the original ambition for delivery of a dashboard this year is not going to happen, strong progress can still be made and we need to build momentum with the Single Financial Guidance Body overseeing development and implementation. As always there is a balance to be struck between innovation and consumer protection, but we think the proposal to permit multiple dashboards is a positive step and dovetails nicely with the modern way in which people manage their finances.
"We think most modern DC schemes should be able to hook up to a dashboard quite quickly once the data standards and architecture is agreed. For others, it will take more time and legislation, but we think a great first step would be for a pension finder service to cover all schemes."
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