The current project is focusing on people for whom it is already too late to make a big difference
A car showroom salesperson would never show you the basic model first, even if it was completely suitable for your purposes. We all end up paying for functionality we will never use. Which takes me to the pensions dashboard.
It all started so well. But then we saw the Association of British Insurers try to cut the adviser out, which ended up with it cutting itself out too. That is the problem when you operate alternative agendas.
Why we seem to be hell bent on a fully comprehensive system from day one is lost on me and many others, my fellow Money Marketing columnists Nic Cicutti and Ian McKenna included.
The purpose of the dashboard should be to engage people as early as possible in making adequate pension provision. By definition, that means targeting the under 45s, few of whom will have legacy defined benefit schemes.
If we proceed on the current path of trying to provide a solution for all ages, the litany of different arrangements that people over the age of 45 have will be a major barrier when attempting to produce an easily understandable statement of their total position.
Back in the late 1990s, there was a project that hoped to produce a combined statement of someone’s personal and state pension arrangements. This got derailed when the Department for Work and Pensions were told that some people had more than one pension – something that had not been allowed for in the design.
Had it gone ahead, every insurer would have had to publish combined statements with the state pension replicated on each, meaning someone who had three pensions could be forgiven for thinking they had three times the amount of state pensions. So the project was canned.
With today’s project, we are trying to do far too much for the wrong people. It cannot be that difficult to bring in some basic legislation that forces all master trusts to feed the information through to a dashboard.If you can force the information through from the insurers and the DWP, then we have a dashboard that is workable and aimed at the very people most likely to look at it.
As it stands, for many of the people the dashboard is trying to help, it is already too late to have a significant impact. It needs to be taken by the scruff of the neck, otherwise it is going to fail miserably. If we are going to communicate, we have to communicate in a way that works.
Sadly, the project has been derailed by those who see advisers as a threat rather than an ally.
The view that it will be easy to obtain useable data from multiple sources is overly optimistic. The country needs a dashboard but it needs to be aimed at the right people, and, at the moment, I am not sure it is.
Robert Reid is partner at CanScot