Under the plans set out in the PDP’s “Call for input on staging”, schemes will be required to supply full data on members in ‘waves’, starting with Master Trusts, large group personal pensions run by insurers and large DB schemes. But schemes will have to be ready to supply not just details of membership but also ‘value’ data – ‘estimated retirement income’ for each member. This is likely to be a huge job for some schemes, particularly those DB schemes who do not routinely even calculate estimated retirement incomes for deferred members.
The PDP argue that the public would have a ‘low tolerance’ for a dashboard which only supplied details of pension scheme membership in the first phase. But LCP argue in their submission that whilst the public obviously want a comprehensive dashboard as soon as possible, this is likely to delay the go-live date as schemes need longer to get ready. LCP argue that an ‘early win’ would be to have a live dashboard which gives people an overview of all the pension schemes of which they are a member and re-unites them with ‘lost’ pension pots as soon as possible.
According to LCP there are several advantages with this approach:
A dashboard is most likely to be used by those closest to retirement and they cannot wait several more years for a dashboard to go live;
An early launch of dashboards with membership data will generate lots of ‘good news stories’ as people find lost pensions; this will generate positive interest in the dashboard after years of negative coverage around delays;
Even smaller schemes can reasonably be expected to provide lists of their members, which means that wider coverage can be achieved earlier by going for a ‘find’ service first;
LCP point out that once members can see all of their pensions in one place this will generate a huge volume of inquiries for schemes and employers. Members will query:
Where pensions have gone that they expected to see which are missing
Unexpected pensions which they may not recognise, possibly because of a change in the name of an employer or administrator
Pension amounts which do not tally with previous pension statements
A ‘big bang’ switch on of the dashboard is likely to lead to a capacity crunch for schemes and employers as members inundate them with questions. So LCP advocate a phased switch-on of the dashboard, with only those closest to pension age initially able to access the data. As the first users experience the dashboard the experience can be refined and then gradually expanded to cover those in younger age groups.
Commenting, LCP partner Steve Webb said:
“It is great that we are now starting to see some of the detail about how dashboards are going to work. But the determination to go live with estimated retirement incomes as well as memberships could actually delay the launch. Re-uniting people with lost pensions is a huge potential positive from dashboards and this shouldn’t be delayed any longer. We also need to recognise that when people see the data on dashboards they will have dozens of questions and presenting them with value data will greatly increase the pressure on schemes and employers to have the capacity to handle them. A phased approach to accessing the dashboard would also be a good idea”.
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