Judging by its response to my last column on the subject of pensions dashboards, in which I called for it to be removed from the project, I seem to have got the attention of the Association of British Insurers.
But let’s put to one side my thoughts on who should lead the project and focus on the impact of recent events instead.
If the dashboard project proceeds along the lines outlined by the report “Reconnecting people with their pensions” published on the ABI website in October, it will have catastrophic consequences. This will not just damage advisers but also the life and pension providers and platforms that rely on advisers as their primary form of distribution.
Pensions dashboards should deliver consumers an unparalleled level of information about their retirement savings. This is a really important objective and one which should encourage millions to pay more attention to their prospects for an income in retirement.
Having provided consumers with such information, the natural question for many will be: what do I do next? The obvious answer is to take advice.
The current minimum viable product, as defined by the above report, is for a service that will not include adviser access to information offered to their clients by life offices and platforms delivering pension dashboards.
Having discussed this approach with a number of sales professionals within ABI member firms, they are dreading the prospect of having to explain to advisers that their organisations have built an exceptional new service for their clients but that it can only be accessed by the client.
Surely this will arouse many advisers’ worst suspicions as to the motives of a pension provider in delivering such a service. If I was asked to come up with a mechanism to undermine the adviser community in a digital world, I would struggle to come up with a better plan than the proposed minimum viable product recommended in this report.
Given the pension dashboard was an output of the Financial Advice Market Review, does it really make sense to deliver a service that cannot be accessed by advisers?
Call me a cynic but I strongly suspect a project that not did not include access by pension providers as part of the minimum viable product would never have got sign off by the ABI’s project group.
But ironically – and disturbingly – it is now looking like this may well be exactly what we end up with.
Although it is yet to publish any formal proposals, the view in informed circles is that the Department of Work and Pensions’ preference is for a dashboard built as a single service that would only be accessible by consumers via the forthcoming single guidance body.
This is an approach that was thoroughly discredited during the Treasury phase of the project and that would almost certainly ensure pension dashboards will never be delivered. Anything that is delivered will be worthless, costing consumers vast amounts of money for zero benefit.
The Treasury was adamant throughout its management of the project that the one thing it wanted to avoid was a large government IT project, as, by their own admission, this is something government departments do incredibly badly.
The pretext for this is that the consumer research during the last ABI-run phase of the project found a single dashboard would be the preferred option.
This was based on a forum session attended by Age UK, Which?, Money Advice Service, Citizens Advice, Trades Union Congress, The Pension Advisory Service and PensionWise – i.e. dominated by organisations which either have a negative perception of the private sector or which offer free alternatives to advice.
Hardly an impartial audience. In addition, the independent consumer research was co-funded by the Money Advice Service, so no surprise it delivered a message supportive of the single guidance body.
One issue that would need to be addressed in such a plan would be who would pay for the dashboard. Again during the Treasury phase, it was made clear the industry would be expected to pay for it. You can hardly ask an industry to pay for something they do not have access to.
If the DWP really wants to pour tens of millions of pounds of taxpayers’ money into a monolithic government IT project, go ahead. But this will be a very poor outcome for consumers.
The DWP is holding a series of meetings on 11 December to consult with interested parties. This is perhaps the last opportunity to save what should be a flagship project.
The industry should be calling for the project to revert to the Treasury plan that will provide consumers with the greatest choice. A choice of who they wish to get assistance from: the new centralised guidance body, pension providers or advisers. That would be a whole lot easier if ABI members were to give a similar commitment to supporting advisers.
Ian McKenna is director of the Finance & Technology Research Centre