UK pension schemes are being asked by the pensions minister to report on the readiness of their data for the dashboards project, but specialists argue the lack of legislation and data standards could make it difficult to obtain accurate responses.
In a letter sent to pension schemes on Tuesday, seen by Pensions Expert, Guy Opperman argued that the government “remains fully committed to delivering the legislation to support the introduction of safe, comprehensive and effective pensions dashboards”.
He promised that regulations in this area will be introduced “at speed” following the completion of the pension schemes bill through parliament this year, which will compel schemes to provide data for the project.
Mr Opperman said: “My message to you on data readiness is clear: neither government nor industry can afford to sit back and wait for the legislation before getting ready to bring pensions into the digital age.”
In the absence of clarity about the data standards schemes will have to comply with, and legal certainty about when obligations will come into force, it will be difficult for schemes to provide accurate responses to the questions in the letter
Nigel Peaple, PLSA
The Department for Work and Pensions confirmed in December 2018 that it will seek to foster the creation of multiple pensions dashboards, with the first developed by the Money and Pensions Service.
Its industry delivery group will set out a timetable for other fully operational dashboards, as well as setting standards and ensuring security across the portals.
More clarity needed
Schemes are now being asked to report back to the DWP by July 8 detailing their state of readiness to deliver quality data via dashboards, what they are doing to review their data quality, which problems have been identified, and what solutions will be implemented.
However, the Pensions and Lifetime Savings Association has warned that it might not be easy for schemes to provide this information.
Nigel Peaple, director of policy and research at the PLSA, told Pensions Expert: “In the absence of clarity about the data standards schemes will have to comply with, and legal certainty about when obligations will come into force, it will be difficult for schemes to provide accurate responses to the questions in the letter.
“Nevertheless, I am sure schemes will do their best to respond to the minister’s questions.”
Mr Peaple noted that the industry body is “acutely conscious of the challenges many schemes will face in preparing their data for dashboards, given that they are often dependent on others [such as individuals and employers] to update the data they hold”, and has been raising awareness to the issue.
According to Steve Webb, partner at LCP, a key issue on the dashboards project “will be the speed at which different pension schemes and providers are required to supply data, which is why the minister is asking schemes how long it will take them to be ready”.
“As with automatic enrolment, not everything will happen at once, but there is no doubt from the minister’s letter that there is a real sense of urgency now about this project,” Sir Steve added.
DB schemes to face major data exercise for dashboards
New requirements to translate defined benefit pensions into an annual income in today’s terms could mean trustees and administrators face a major data exercise to comply with the pensions dashboards, according to experts.
Matt Dodds, director at ITM, warned that pensions dashboards will “only be as good as the data they use and share”.
He said: “We know from experience that data readiness varies greatly across the sub-sectors of the industry defined by Maps.
“Some have much more work to do than others, but it is no longer acceptable for schemes and providers to put off engaging with what it really means to be data ready for pensions dashboards. Every sub-sector of the industry needs to sit up, take note and get data ready.”
