Consumers must be ‘at the heart’ of the pensions dashboard; growing evidence for compulsion – Opperman

Consumers must be “at the heart” of the pensions dashboard and there is growing evidence for the compulsion of data to ensure trust and confidence in the platform, Minister for Pensions and Financial Inclusion Guy Opperman has said.

Speaking at a Pensions Dashboard Stakeholder event earlier this week, Opperman explained that “proper engagement” with the dashboard will only take place if the consumer trusts that information is fully complete “to the extent that it is useful”.

According to user research carried out by the Money Advice Service, there is low tolerance among consumer for an incomplete dashboard. “That is why we need all parts of the industry on board,” the Minister said.

He continued to highlight that with the success of auto-enrolment and greater flexibility through the pension freedoms, the dashboard is the next step to enable members to obtain a sense of ownership over their pension savings.

“Increasing engagement can help people better understand their pensions and maximise their savings for retirement; developing a sense of personal ownership and building trust in the system. How we achieve that is of course not straightforward. It is not all going to be magically solved with a single tool. But clearly the pension dashboard could form a critical part of this journey.”

As previously discussed, the Pensions Minister noted that the DWP will also “take the learnings” of other countries, such as Sweden, who already have a dashboard in place and will look to “build on their successes”.

Opperman noted that from analysis of foreign dashboards has highlighted the need for compulsion and that “while different dashboards had different impacts…a common theme across all dashboards has been an increased level of engagement with pensions.”

“Whether it’s the experiences of other countries or qualitative user research, there is growing evidence for some form of compulsion to bring about a complete dashboard in a reasonable timeframe. But there are different ways of approaching this – the Swedish example is an interesting one, where legislation was, in the end, not necessary.”

Further considering the importance of data to the dashboard, Opperman highlighted that scheme providers have a “duty” that each members’ data belongs to them and is made available on request.

“Whatever our approach, and particularly if we enable expansion into the open market, a consumer protection framework will be vital to mitigate the risks of poor choices, potential misselling and scams. And of course, the data must be kept secure,” he concluded.

“We need to maximise people’s engagement in their pension while maintaining their trust. We will ensure that consumer interests are properly safeguarded and their information protected.”

Opperman reiterated that he is “utterly pleased” that the Department for Work and Pensions have been assigned the responsibility to take the dashboard project forward from HM Treasury. Looking at the process so far, Opperman stated: “We might have taken more than a few preliminary steps with this… but the journey is now on! The government is truly on board.”

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