Coming soon to a screen near you...pensions dashboards

Several years in the making, there is now light at the end of the tunnel for savers.

Commenting, Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “Several years in gestation, today’s rules finally mean there is light at the end of the tunnel. That means more clarity for people who want to take control of their pensions – and that’s a game changer. The finer points of pensions dashboards initiative have now been set in stone, with an implementation date of 31 August 2023.

“Pensions dashboards have been long in the making and can’t come soon enough to help savers make better informed decisions regarding their retirement nest egg. It will encourage people to take a greater interest and ownership of their retirement plan, and potentially encourage people to shop around and consolidate into a better value product. Far too often, pensions plans are neglected and with every job change can all too easily end up in the rear view mirror, making them easier to lose track of.

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“It’s widely accepted that simplicity is key to the success of the pensions dashboard initiative. There may be bumps in the road, but today’s rules are a milestone moment. Sorting complex information underlying pension schemes into easily digestible nuggets of information is vital. Pensions dashboards should also give users the ability to do something with this information.

“The pensions dashboard will by no means be perfect on day one. The FCA’s final rules now state that, where costs and charges information for a particular pension is not currently available online, the signposted website must, as a minimum, explain clearly to the consumer how they can obtain details about the costs and charges that apply specifically to their plan. This adds unwanted friction in what is meant to be a seamless initiative.

“A concerted programme of education around how to interpret the dashboards will also be key to achieving the government’s stated aim of boosting pension knowledge and engagement.”

Alice Guy, Personal Finance Expert, interactive investor, says: “By making pensions clearer, the new pension dashboards will help people take charge of their financial future. They will be able to keep an eye on their pension wealth in one place and make sure they are on track for a comfortable retirement. The dashboards will also make it easier for people to spot confusing, rip-off pension charges and make sure they are getting a good deal.”

FCA’s final rules require that regulated pension providers must:

• complete connection to the digital architecture operated by the Pensions Dashboard Programme – which is a function of the Money and Pensions Service (MaPS).
• be ready to receive requests to find pensions, and search records for data matches.
• be ready to return pensions information to the consumer’s chosen pensions dashboard.
• Firms must implement FCA’s final rules by 31 August 2023. Firms that intend to use the later implementation date transitional provision must notify us by 30 April 2023.