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John Lawson: Will lack of coverage kill the pensions dashboard?

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.

John Lawson: Why we need multiple pension dashboards

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.

Pension dashboard pressure: Will new technology live up to the hype?

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



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There are 3 comments at the moment, we would love to hear your opinion too.

  1. Christopher Pitt 4th October 2017 at 12:30 pm

    Good to hear that the Pension Dashboard project is still progressing nicely however, it will live or die on the coverage issue. Unless there’s near universal participation from every corner of the UK pensions industry then I suspect it will fail – and that’s simply not in the interests of the Pensions industry, its’ clients or society as a whole. I get the point about some pension schemes having to invest in converting from paper records but surely it’s about time that investment was made? As an industry it’s about time we all simply decided to “do the right thing” by our clients and get on with creating a proper Pension Dashboard without having been forced to do so by the government.

  2. If you build it they will not come. No matter how good it is, how complete it is, how many providers support it the public won’t use it.

    It will help advisers for sure but the general public don’t care. I visited a guy this morning he hadn’t looked at his pension statement in 8 years, handed them all to me still in the envelopes, £200k fund hadn’t a clue.

    Sadly he is not the exception.

    If folks don’t even look at the envelope that drops through their door every year what chance they bother with this.

  3. Freddie Findlater 4th October 2017 at 2:52 pm

    Interesting that “pot follows member” was mentioned again by Guy Opperman at the Conservative Party Conference yesterday. He said it was “back on the table”

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