Unless you follow developments very closely, you could be forgiven for thinking it had all gone a bit quiet on the pensions dashboard front. But that does not mean nothing is happening. Far from it.
As someone who is part of one of the work streams I can confidently say the project is progressing nicely.
However, there are challenges ahead. The phrase “a coalition of the willing” has been used to describe the organisations and companies helping to build the dashboard. What that indicates is that there are some parties who are unwilling or at least not on board yet. And it is here the challenge lies.
The dashboard will live and die on the comprehensiveness of its coverage of the pensions market. If most people logging on are still only seeing part of their retirement savings, the project will fail as savers will be in a similar position to where they are now, having to contact different providers to get a complete picture.
Earlier this month, the Association of British Insurers’ director of policy, long-term savings and protection Yvonne Braun made it clear she believes we will need some form of legislation or regulation to achieve 100 per cent coverage. Without it, there will be some pension providers and administrators who do not want to take on the burden of digitalising their policies. And there are still schemes where paper files are the first, and sometimes only, option.
But this is not about forcing the hand of all corners of the pensions industry. It is about doing what is right for consumers. With the decline of defined benefit schemes and the rise of defined contribution schemes we all need to have a much closer eye on how our pension savings are progressing.
Clearly, a single online interface to do this would make things much simpler. Imagine managing your monthly finances if you had multiple payments going in and out from multiple different accounts with different banks. It would be incredibly time consuming and you would likely end up overdrawn somewhere.
That is not to say I am expecting this to be done and dusted in time for launch in 2019. While 100 per cent coverage of the pensions market is the desired aim, I do not think the dashboard will fail if that is not achieved immediately. As long as the vast majority of pensions are available from launch and plans are in place for total coverage within two years, then the dashboard will work.
We can learn a lot from Denmark. They have had a pensions dashboard for over a decade but it took almost total coverage of the pensions market to really pique people’s interest in their savings. When it originally launched people only had a limited view of their pensions so engagement was low. Now, in a country of only five million people, it has more than a million regular users. It is clear that a dashboard with widespread coverage of the market does have the power to engage savers.
John Lawson is head of financial research at Aviva