By Dale Critchley, Workplace Policy Manager, Aviva
The Department for Work and Pensions (DWP) has proposed “indicative draft regulations” on the requirements for both occupational pension schemes to provide data into the dashboard in response to ‘find requests’ as well as those that must be met by dashboard providers. The Financial Conduct Authority’s (FCA) consultation is about what personal pension scheme providers must do to link their member data up to the dashboards. Third, and finally, the Financial Reporting Council (FRC) issued a consultation on changes to the way in which projections in annual statements, and therefore for pension dashboards, must be produced from October 2023.
As the provision of a dashboard will be an FCA regulated activity, further detail is expected from the FCA on that at some point.
Frequent reference has been made to Money and Pension Service (MAPS) design standards and Pension Regulator standards, which we can also look forward to.
Aviva is one of three companies, and the only pension provider, working with MAPS to test the design of pension dashboards with end users. The aim is to ensure that, as far as possible within the constraints of the available data and the aims of the DWP, the MAPS design standards produce the best possible customer experience.
What is clear is that dashboards will be highly prescribed by MAPS. DWP have posed whether data from dashboards could be used in systems sitting alongside dashboards, which seems sensible. The FCA’s Consumer Duty will ensure that any FCA regulated firm is fully cognisant of the needs of scheme members and takes great care to meet them. There could be an opportunity to use “find data” - a scheme member’s personal details - to update member records with any missing items like postal address or email address. Having email addresses could lead to a step-change in communication with all members – particularly deferred members.
When pension dashboards go live it will not be the end of the dashboards journey. To ensure the maximum number of pension pots are found, and the data is provided, compromises will have to be made. The initial launch dashboards may not be the same as dashboards of the 2030’s. It is expected that MAPS design standards will evolve over time.
It is not to say that the initial dashboard will lack anything in the way of utility. Reuniting individuals with lost pots and being able to see a value for all of them in the same place will be a step-change from where we are today. It will undoubtedly drive activity to consolidate disparate pots and to harmonise selected retirement ages to make management and planning easier. If schemes can integrate their dashboard with their wider planning tools and member journeys, we can harness the true power of dashboards - which is to encourage and enable good retirement decision making.
Much of the heavy lifting will be carried out by administrators, but trustees of occupational pension schemes remain accountable for compliance with the new regulations. That begins with connecting to the central dashboard infrastructure - a phased process like automatic-enrolment staging dates. The first step for any trustee is to get to know their staging date, and then make sure dashboard readiness is on the agenda for trustee meetings leading up to staging. The requirement for data to be up-to-date is well documented but trustees should be making sure that data agreements are also in place with the party that will be providing returns on their behalf. As well as understanding how that process will work in terms of matching criteria and data security.
The Pensions Regulator (tPR) will be contacting schemes twelve months before their staging date and will be producing trustee guidance shortly. A year always sounds like a long time, but it may only be four trustee meetings. Therefore, getting a plan in place sooner rather than later makes sense.
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