The pension minister Emma Reynolds used her speech to the Pensions and Lifetime Savings Association conference in Liverpool in mid-October to confirm her “steadfast commitment” to the Pension Dashboards project.
The pensions sector and those involved in driving the project welcomed her assertion that the government “wants to ensure that the public can realise the benefits of using a pensions dashboard at the earliest opportunity”. But perhaps the use of the singular dashboard as opposed to dashboards plural should have rung alarm bells for the sector.
Hopes dashed?
Reynold’s subsequent ministerial statement, published on 22 October, said: “I have directed the Pensions Dashboards Programme to focus its efforts on the connection and launch of the MoneyHelper dashboard service, provided by Money and Pensions Service (MaPS) before turning to the work of connecting commercial dashboard services.”
The statement added that the government supports “the principle of enabling multiple commercial pensions dashboard services” but added that “in the interests of ensuring consumers have the best experience, it is
prudent to allow a period while only the MoneyHelper dashboard is operational.
“Prioritising the launch of the government-backed dashboard will provide an opportunity to obtain better insights into customer behaviour and ensure greater confidence in operational delivery, security, and consumer protection before facilitating the connection of commercial dashboards.”
The minister added that the timetables “for the connection of pension schemes and providers to the pensions dashboards ecosystem” remained the same.
The pension industry’s reaction has been measured, but it wants the time gap between MoneyHelper’s dashboard and the launch of commercial alternatives to be short.
Minimise the time gap
Aegon head of pensions Kate Smith says: “Launching the public MoneyHelper pension dashboard before commercial dashboards enables the government to make sure that everything works as it should. This makes it even more important that the government publicises the MoneyHelper dashboard so that the public know it exists and what it does, so they actually use it.
“We believe that people are more likely to use commercial dashboards provided by the scheme or provider they are already saving with. Commercial dashboards will have a significant role to play, maximising the numbers of people using dashboards with the potential to change the dial on pension engagement. It’s important that the government minimises the gap between launching the MoneyHelper dashboard and enabling commercial dashboards and provides greater clarity on timeframes.”
Commercial dashboards used at scale
Richard Smith, chair of the Commercial Pensions Dashboards Coalition simply points to Norway, contrasting 900,000 data requests from the state service with the 32 million requests from 12 commercial providers. He also acknowledged the commitment to the commercial side.
He says: “Norway shows which pensions dashboards people actually use, at scale. So this latest ministerial statement re-committing to multiple dashboards is really great news, so long as the government and regulators actually do enable ‘Qualifying pensions dashboard services (QPDS) to be launched very soon after MoneyHelper. It’s very clear most people want to see all their pensions together on apps from brands they trust, so come on, let’s get QPDSs done together, soon.”
Plans derailed
The Lang Cat’s director of public affairs Tom McPhail says that the private reaction to this news is rather more critical.
“The people I have spoken to are not happy. There are two things here. One is that you have got firms who are actively intending to run a dashboard or building the services to help deliver one. Their plans are being derailed. Across the industry, I can’t see anyone who is going to welcome this positively. Separately this looks like the government looking to bolster the role of MaPS at a time when that organisation is working hard to justify the services it provides.
“The loss of goodwill and erosion of collective purpose caused by this announcement shouldn’t be underestimated. Obviously, everyone is going to keep preparing their data, but this decision is not going to help things go fast or smoothly. It has taken the air of collective purpose out of the whole enterprise.”
Others suggest a delay could be quite long. Bravura Solutions propositions lead EMEA, who is also a director of PASA, Jonathan Hawkins suggests that commercial dashboards could now be a few years further down the road from getting into the hands of the public. He worries that innovation could stop at the point the government dashboard launches without industry pressure on policymakers to continue the work to enable and promote commercial dashboards.
National embarrassment
Discussing the delay, Financial Technology Research Centre CEO Ian McKenna says: “This has always been a risk. The problem is this project is so late, it should be a national embarrassment. To hold back commercial dashboards… makes no sense.
“It was around as a suggestion back in 2016, but I have never seen a good reason for a delay. Where is the sense or benefit in delaying organisations that have spent tens of millions of pounds on this? Though I do worry the Labour Party always wanted a single government backed dashboard.”
Asked whether there was still a way around this delay, perhaps using open data, McKenna says: “A lot of the pipes have been put in. Could you connect it up to the infrastructure that insurers use to support advisers? The problem is that we have open banking, but we haven’t really taken forward open finance or open data. What you have to get past is some institutions wanting to reserve data for themselves.”
He says that we need the Data Protection and Information Bill to come into force and to enshrine the rights of citizens to say who can have access to their data. That would help firms such as consolidators who have built significant infrastructure.
Although made before Reynolds announcement, recent comments from a Conservative former pensions minister Guy Opperman may give some further insight into this. Talking to Pension Playpen, Opperman said: “It is quite clear that it is exceptionally difficult to get a dashboard over the line when the quality of the data – and the money spent to upgrade the data – is limited.”
Smith though remains bullish. Again citing Norway, he says: “If you take standard pension information and put it on apps which people already use and trust, that is where they are going to go to look at their pensions.”
Assessing the challenges, he divides them into data display, retrieval of that data, and the supply of that data , saying all need to work together to be “on track”.
He adds that you can mandate as much data provision as you want, but unless you get a useable front end “it will all be for nought”. For trustees, he adds: “It will be helpful to see what the member is actually going to see on a layer two dashboard, because you might send the data differently. This is what every other country did i.e. thought vertically through the eco-system, the consumer journey.
“Every other country got their system working on a voluntary basis, but what we are doing is mandating the bottom of the hourglass before we have a working dashboard on the front end.”
He advises Money Hub one day a week and says that the excitement in consumer testing is palpable and consumers love what they see.
He does question other aspects. One is communication between the government’s central identifying service and schemes in terms of performance where ‘find requests’ are meant to respond within 60 seconds. There could be 20,000 or 30,000 people in a day making these requests.
He also notes that dashboards will be regulated by the FCA but we have yet to see final rules following a consultation. But he is much more enthusiastic about the fact that dashboards will come under the Consumer Duty regulation and, as such, will have to communicate effectively with vulnerable consumers. Meeting this requirement will bring a dramatic improvement in pension communication, he says.
The broader pensions world while often cynical about delays still sees huge opportunities including around the use of open data.
Greg Neall, chartered financial planner with Wake up your Wealth says: “I think the dashboard could be very powerful in delivering efficiency into the advice process. A central source of current values and policy
numbers, which an investor can log into during a meeting, could avoid a lot of administrative delays and errors.
“I can see that it could be linked to providers’ systems, to offer straight through registration of letters of authority and/or access to contract information e.g. charges, funds, and other additional features. This supports automated advice recommendations on whether to combine previous employer’s pension with your new employer’s one, because API technology can link the dashboard to provider and adviser systems in the same way that open banking can.” Smith’s also adds that the launch is just the start of the process, pointing out that Denmark’s dashboard, launched in 1999, is on its seventh iteration.
The government and sector does, however, have to get to that starting point first.
