Plans to deliver a pensions dashboard prototype by March 2017 have been completed, despite the complex nature of technology infrastructure involved. But while experts think the progress is encouraging, they say more needs to be done to maintain this momentum.
Due to go live in 2019, the dashboard is designed to enable everyone to easily access their pension information online and in one single place.
The Association of British Insurers, which manages the project on behalf of HM Treasury, said the launch of the prototype, which has now been demonstrated to government ministers, shows that “technological hurdles” need not stand in the way of the product’s development.
We need to be realistic and not treat this as some sort of panacea that will solve the savings gap in the UK
Tom Selby, AJ Bell
The cross-industry project has the potential to improve engagement in long-term saving, while benefiting those who have accrued money through a number of different employers.
On the other hand, some have voiced concerns about the ambitious timeline of the product, given the complexity of the technology involved, while the issue of cyber security has also sparked data protection worries.
However, the ABI said the regulation of future dashboards, "whether by the Financial Conduct Authority or by a new independent body", would be able to insist on certain data and security standards.
Moving to the next phase
Philip Brown, head of policy at insurer LV=, one of the companies that have contributed to the prototype project, is pleased that “we have shown how this system can be developed”.
He said: “We now need the government to provide the working group with a clear indication of what is anticipated in the next phase, how next steps are to be managed, and set out stringent timescales to keep up the momentum.”
Will the pensions dashboard live up to its potential?
Last month the government formally committed to the creation of a pensions dashboard, which will be an invaluable aid in helping people plan for retirement.
Brown said it is also crucial that the government makes it compulsory for providers and schemes to take part if participation is slow, “otherwise the dashboard is going to be ineffective and benefit far fewer consumers than it has capacity to help”.
Tom Selby, senior analyst at platform provider AJ Bell, said allowing people to see all their pensions in one place “would be a welcome step forward and should help boost engagement with retirement saving”.
However, he added: “We need to be realistic and not treat this as some sort of panacea that will solve the savings gap in the UK.”
Selby explained that one of the reasons people are reluctant to save for a pension is for fear the goalposts will be moved once they have locked their money away.
Pensions dashboard prototype to launch by next spring
The Treasury has said it will be working with 11 pension providers to release a prototype of the pensions dashboard by March 2017.
In order to improve engagement, the government should start by committing to providing stability “rather than constantly tinkering with the pension tax system”, he added.
While there is currently one dashboard prototype, in September 2016 economic secretary to the Treasury Simon Kirby said no single dashboard would be able to meet the needs of millions of people who all have different individual circumstances.
Paul Pettitt, managing director at industry body Origo, said multiple dashboards will enable consumers to gain access to their data from any dashboard they wish.
“Consumers do of course need to receive consistent information, no matter which dashboard they choose to use, and the underlying architecture used by the industry needs to deliver this key feature efficiently,” he said.
