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The stumbling blocks to launching a pensions dashboard

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The pensions industry is moving forward with discussions on introducing a dashboard, but questions remain over firms’ commitment to the project.

The Government gave the industry a clear message in the March Budget that it would “ensure the industry designs, funds and launches a pensions dashboard by 2019”.

The commitment came just days after the same recommendation was made in the Financial Advice Market Review, and the plan has been touted by the FCA as far back as 2014.

Money Marketing understands three separate working groups have been set up to tackle different areas of the dashboard: identification and verification of users, user experience and the architecture of the dashboard. The Association of British Insurers has also just set up a dedicated dashboard team.

A host of options are still under discussion.

Aviva retirement solutions policy head John Lawson says: “The problem at prototype stage is if you become too narrow then that becomes the final model and you don’t flush out all of the issues. If you keep it wide and have a number of different solutions to each of the components of the dashboard, then it gives us the opportunity to test those under a range of different circumstances and see the problems and benefits of each solution.”

It is possible the dashboard will adopt some version of the Government’s new gov.uk Verify online identification system. Verify was launched in April.

Finance & Technology Research Centre director Ian McKenna says: “You have to absolutely ensure there’s a fully robust security system in place to protect and defend customers’ confidential data.

If you are aware your proposition is not as good as the one around the corner, why make it accessible to third parties on a dashboard that will show it up?

“Is there going to be a security mechanism? Absolutely. Verify has to be a contender, but it’s far too early to say whether that’s definitely the solution.

“It’s fair to say if the Government has created a mechanism which consumers have confidence in then it makes a lot of sense to join the dots on that solution.”

The main brake on progress for providers might appear to be cost, but some are concerned the industry may be making a lacklustre commitment because consumers will be able to see better deals elsewhere.

First Actuarial director Henry Tapper says: “I don’t think this is very expensive to do. The industry is making an absolute meal of this.

“They are change resistant. Why should people want to change? They are making lots of money. They are also technology resistant, probably for the reason they have allowed their systems to degrade over time so they don’t even know the code on which the system is run. If you are mildly aware your proposition is not as good as the one around the corner, why would you want to make it accessible to third parties on a dashboard that will show it up?”

Regardless of how the industry pursues the project, however, it is likely to improve record-keeping practices across providers.

McKenna says: “If you are suggesting that in the 21st century there are pension providers of any type whose records are still only on paper, that’s fairly horrendous.

“Those organisations should be addressing their records anyway. If we really are talking about organisations where records are on paper only you would have questions as to whether the trustees would be meeting their obligations.”

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