SPP warns of pensions dashboards delay unless further clarity is provided

The Society of Pension Professionals (SPP) has written an open letter to the Pensions Dashboards Programme (PDP), outlining seven “priority areas” where its members feel further clarity is needed.

The letter, authored by SPP president, James Riley, and immediate past president, Paul McGlone, and addressed to PDP principal, Chris Curry, stated that the industry was concerned that the dashboards may not stick to the timeframe of going live in 2023 unless clarity is provided “urgently”.

Its first priority area was calculation requirements. The SPP stated that greater clarity was needed on some of the more complex calculations, such as estimated retirement income, through better definitions.

The authors noted that these calculations are not automated in many schemes and results do not currently exist to share on a dashboard.

“Where automation does exist, it may not be precisely what the dashboards require,” they continued. “Schemes and administrators cannot start work to deliver those calculations until there is greater clarity on exactly what is required.”

Secondly, the SPP noted that the way information will be shared between schemes/administrators and the various parts of the dashboard environment remained “undefined”, calling for IT solutions to be build and tested to ensure the multiple contact points operate smoothly and securely.

Riley and McGlone also called for an “industry-wide solution”, alongside further clarity, on matching individual savers with scheme records.

They noted that how matching will work remained unclear, and that if schemes or administrators had to use their own unique set of rules it would be “highly inefficient” and lead to differing standards across the industry.

“It also risks schemes faced with making their own rules reverting to a ‘least risk’ approach, where they will only release data if absolutely certain, leading to too many missed matches,” the letter warned.

An industry-wide solution was also called for on partial matches, with the letter identifying issues with whether there would be a system for schemes to flag they have a record that is similar, but not an exact match to, the member, and how partial matches will be resolved.

Concerns around legal issues were raised, with the SPP noting that schemes and administrators would want assurances that any failure of the dashboard infrastructure that led to data breaches or incorrect information being issued would not result in them being liable for losses or claims.

The letter also called for further clarity on the timing of the stages leading to the roll out of dashboards, noting that the broad timescales mean schemes and administrators have no certainty over what will be required when, including how any staging will work and whether their deliverables will be required all at once or gradually over time.

Finally, the SPP said more needed to be done to “call individual schemes to action”, warning that understanding of dashboards at a scheme level remained “poor” and explanations were needed as to what actions they need to take and when they need to be done by.

Despite their concerns, Riley and McGlone said that they were grateful to Curry and all those directly involved in dashboards development for the work they have done to date, and offered SPP’s assistance in further development and engagement.

“To conclude, the industry needs clarity on a range of issues, and an indication of a clear timeline, so that we can prepare accordingly,” they stated.

In response to the letter, Curry commented: "We would like to thank the SPP for their feedback on the seven priority areas they have identified in their letter as requiring further clarity and for their request for a clear timeline to enable their members to prepare accordingly.

"We published our indicative phase plan in October 2020. One of our key aims was to provide our stakeholders with an early indication of when we think they will need to act. Notably, we set out our view that compulsory staged onboarding would begin in 2023.

"Since October, we have been developing our plans and integrating within those with the complex landscape in which we are operating. Our overall phase plan remains on course.

"We recognise that pension providers, schemes, administrators, trustees and ISPs want more certainty and detail around what they are being asked to do and when they will be asked to do it. The procurement and onboarding of a technical delivery partner is key to this timeline and with our procurement of the principal digital architecture to commence imminently, we will shortly be in the position to add further detail to this timeline.

"Additionally, with further work taking place on developing an onboarding strategy, we will soon be able to provide an indication of when schemes will have sight of technical specifications and a detailed technical and integration plan (including API details).

"With the passing of the Pensions Schemes Act last month, we are working with our colleagues in the Department for work and Pensions (DWP), The Pensions Regulator (TPR) and Financial Conduct Authority (FCA) to help them develop and consult on the detailed regulations that will require industry to deliver the data required for pensions dashboards. We will continue to engage with industry on these requirements and provide further guidance on how best to get dashboard ready.

"The DWP is committed to delivering dashboards and it aims to consult on proposed regulations for the pensions dashboard later this year and lay draft regulations before Parliament for debate in 2022.

"We are committed to providing as much information as possible as soon as it becomes available, to provide industry with sufficient warning to prepare their systems."

Commenting on the letter, Association of Consulting Actuaries chair, Patrick Bloomfield, said: “The ACA stands shoulder to shoulder with the SPP and PDP in wanting pension dashboards to be a success. Pension dashboards have the potential to transform saver engagement. But to keep saver confidence, the dashboards will need to work from day one. 

“Industry urgently needs clarity on the key components pension schemes need to prepare, to have a fighting chance of covering the ground needed to launch dashboards when planned. We recognise that the issues are complex and think that PDP is doing a good job of bringing industry together. What we don’t want to see is government blaming industry if dashboards struggle to ‘go live’ on time, when the reality is that industry didn’t get the information it needed to be able to.”

PLSA director of policy and advocacy, Nigel Peaple, added: “We agree that solutions are needed to the seven issues outlined before pension schemes have all the information they need to fully prepare for pension dashboards. We understand that Maps’ PDP, DWP and TPR, are working on these issues.

“As the PLSA has previously stated, we estimate that large DC pension schemes will need around two years from the date when all the requirements are settled to the point when they will be ready to join the dashboards infrastructure. DB schemes are likely to need longer.”

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