Although the dashboard could help consumers get on top of their finances, there are widespread concerns about its design and readiness, as this month’s RP Inquiry found.
When the pensions dashboard launches in 2019, consumers will be able to see all their pensions in one place, helping them to make more informed decisions about their finances.
But there are huge doubts over whether the dashboard will be ready in time and meet consumers’ demands about technology.
Recent developments
The dashboard is only at the prototype phase, but it aims to enable people to access details of all their pension savings, including their state pension and final salary schemes.
The project has been demonstrated to the Treasury and in the coming months we can expect to see further debate about its legislation, regulatory framework and potential governance body. Recently, it was reported that ministers were exploring how pension schemes can be forced to meet data standards.
Is it a good idea?
This month’s RP Inquiry asked readers if they think the pensions dashboard is a good idea in theory. Nearly two thirds (64%) said “it is a great idea”, 27% said “it is an OK idea”, 5% said “it is a bad idea” and 4% were unsure (see chart 1, above).
Several survey respondents said the dashboard will help people keep better track of their pensions and help them connect with their money.
One reader said: “Having worked at the coalface as an IFA, I see how many times a client has lost touch with a pension and often thought that they were either no longer worth anything or that they couldn’t access it if, for example, they had been in a GPP with an ex-employer.”
But one reader, who said the dashboard is an OK idea, warned: “I’m not convinced that the majority of members will want all their pension information accessible from one place, particularly with cyber criminals already targeting pensions.”
Another stated: “It’s the wrong solution to the problem. ‘Pot follows member’ is the right solution for smaller pots. Bigger pots should be up to the individual to manage.”
An adviser who said the dashboard is a bad idea argued that the government is “pandering to the pension providers’ insurance companies.” He said planning for later life is not just about pension plans, or ISAs, property and cash.
“It is about establishing client needs and wants,” he added. “What is the lifestyle that they wish to maintain, establishing the ‘how much’? For far too long, the focus has been on the sale of products.
“While products may be part of the means to provide people with the capital and/or income they require, they are not the main focus – people’s lives are. No computer or website is going to be able to get to know our clients like a human being can.”
Helping advisers
Some readers were optimistic that the dashboard could help their jobs as advisers, with 40% agreeing to this statement. However, they added it will help only if the data is useful, relevant and accurate (see chart 2, above).
Of the 18% of respondents who disagreed with the statement, one cautioned: “A little bit of knowledge is dangerous. Will folk still take advice if they think they know what they are doing?”
The majority (42%) of readers were unsure whether the dashboard would help them. One said: “Potentially, but not definitely. It might not provide details required by advisers to keep the complexity down for the client.”
Implementation
Although respondents to the Inquiry were broadly optimistic about the theory behind the dashboard, it revealed widespread negativity about its implementation.
RP asked how likely it is that the dashboard will be ready by 2019 – only 7% of readers answered “very likely”. A further 35% said “somewhat likely”, but 30% answered “somewhat unlikely” and 26% “very unlikely” (see chart 3, above).
A reader who answered very likely said: “If the dashboard means the technical project delivery, then I believe it will be delivered by 2019. If the dashboard means full coverage from all pension scheme data holders, then I do not believe this will happen until compulsion becomes a reality.”
A reader who answered somewhat likely pointed out that while it will be straightforward to get mainstream pension plans inputted and updated accurately, this might not be the case for many older-style pensions.
Another added: “Despite the recent fanfare, it is still unclear how the complexities of defined pension (DB) data will be taken into account. Defined contribution pots are one thing. DB pensions are quite another.”
Respondents who thought it is somewhat unlikely the dashboard will be ready by 2019 described myriad challenges, such as parliament having to deal with the General Election and Brexit, and providers attempting to keep up with other legislative changes.
One reader who said it is very unlikely the dashboard will be ready stated: “Efforts to record the raft of old pensions has been tried out by various agencies for decades. The funding won’t be spent on frontline information gathering, so it won’t be ready.”
Another said: “I cannot see how the legacy companies will sort this out. It takes days to get information from some companies.”
Technology
The Inquiry also revealed pessimism about the dashboard’s technical design and functionality. Only 7% of respondents said they were very confident that the design will meet consumers’ demands about technology.
A third (31%) said they were “somewhat confident”, but 38% said they were “not particularly confident” and 20% were “not confident at all” (see chart 4, above).
A reader who answered not confident at all said: “As far as I am aware, it has hardly looked at consumer demands regarding technology. It has simply focused on limited pensions people’s views of what it required.”
Many were concerned the dashboard would not be able to meet the varying levels of tech skills among consumers.
One respondent said: “Consumers will range from those who are completely up to date with the latest technology to those who can’t cope with a mobile phone. One size never fits all.”
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