John Lawson: Why we need multiple pension dashboards

The UK’s pension dashboard is progressing nicely. Seventeen providers and technology firms are on board, the Treasury and the Association of British Insurers are supporting, and a prototype has already been delivered.

That said, a complete working dashboard is still some way off. It is unlikely any of us will be able to log in and see our pensions until 2019 at the earliest. But when we can, what will we see?

The answer to this will greatly depend on whose dashboard we are using. Indeed, despite it being clear from the outset, many have been under the impression there would be a single dashboard, perhaps hosted on a Government website. That is not the case.

The work going on at the moment is to develop the “plumbing” – the route by which all the necessary information about someone’s pension pots can be shared while still being secure. In front of the plumbing, various interested parties will then build their own shop front.

These interested parties could be pension providers, banks, technology firms and so on. Anyone who thinks they can develop a dashboard that consumers will want to use.

There are a number of reasons why this method is being pursued. First, financial technology companies are seen as being a very important part of the UK’s economy. They have the brains and the agility to deliver results in innovative ways. If, when dashboard launch day comes around, the majority of the traffic heads towards a Government website, the incentive for fintech firms to be involved is greatly reduced.

Innovation is key to this project as well. Throughout the process, different methods to solve a problem have been trialled so the best option can be found. It is only right this way of working extends to the front cover of the dashboard.

Different companies will have different ideas about what the dashboard should look like and how savers should be able to use it. Dashboards will mean competition, and competition can help drive costs down for providers and standards up for users.

Indeed, most importantly, multiple dashboards will be of benefit to consumers. They will be able to choose the dashboard that suits them best – perhaps one run by a firm with which they already log on regularly, or the one they find most intuitive and easy to use. After all, increasing engagement with pensions is the number one aim here.

Responding to questions about the use of multiple dashboards, ABI director of long-term savings and protection policy Yvonne Braun said: “The Pension Dashboard Prototype Project is about demonstrating conclusively that it is possible to gather all of a person’s pension entitlements in one place of that person’s choosing.

“It was never the purpose of the project to create a single dashboard, but rather to build the “plumbing” required to verify a consumer’s identity and then find and retrieve all their pension information from the diverse pension schemes and providers, including the state pension.

“This dashboard technology, working behind the scenes, can power a wide range of dashboards to suit people’s circumstances and preferences and to allow innovation, the Government’s stated intention from the beginning. This will allow people to access their information via a trusted source of their choosing. We also believe new products will evolve to help consumers understand their wider financial situation and act on it if necessary.”

While it is likely there will be more scrutiny of this project over the next two years, at least this issue can be resolved simply by adding an “s” to “dashboard”.

John Lawson is head of financial research at Aviva