Taylor Wessing’s pensions partner Anna Taylor details the latest developments with the pensions dashboards project and what trustees should be doing to get their schemes ready for it.
Most recently, the government published a consultation on draft regulations, which set out the detail of what trustees will be required to do and when they will be required to do it, as well as including requirements for dashboard providers.
The draft regulations also set out proposed staging dates for implementation, with the largest schemes by number of non-pensioner members coming first between June 30 2023 — with some earlier obligations for larger master trusts — and September 30 2024, and smaller schemes later in the process.
If this timetable is implemented, it will mean that by the end of October 2025 the majority of schemes with 100 or more members (excluding pensioners) will be obliged to share data via the dashboards.
Given what is proposed and the limited time this will give to get ‘dashboard-ready’, trustees would be well-advised to start thinking about how they will comply now
How will the dashboards work?
The member will go on to a dashboard and submit a request for the search process to begin. The member’s identity will be verified, and they will consent to the sharing of their data with the dashboards service they have chosen.
A “find request” will then be generated and sent to pension schemes that are connected to the dashboards, and the schemes will, if they have a matching record, respond with a unique identifier for each matching pension.
The member can then request information about their pensions from the schemes that have returned a unique identifier. This will then be sent direct to the dashboards. All pensions data returned for the member will then be visible in one place, on the dashboards.
The Money and Pensions Service has been working on creating a dashboard, but the draft regulations envisage that third parties will also be able to set up dashboards.
Each provider will need to be Financial Conduct Authority-authorised and will be required — as a condition of authorisation — to meet various standards, including relating to systems and security.
The dashboards requirements are quite complex. Some commentators have said that given the number of unresolved issues, the existing timeline for launching looks highly ambitious, and that more detailed user testing will be needed to reach agreed quality standards and to avoid adverse member experience from the outset.
However, given what is proposed and the limited time this will give to get “dashboard-ready”, trustees would be well-advised to start thinking about how they will comply now.
Practical considerations for trustees
The draft regulations set out the categories of data that schemes will have to share, but there are likely to be practical challenges in complying, especially as there are tight timescales for providing the required data. In addition, the draft regulations set out a number of governance and reporting requirements, which trustees will need to meet.
Although most trustees will look to their scheme administrator to ensure that the right data is provided within relevant timescales, responsibility for failure to comply will ultimately rest with the trustees, who risk being subject to fines if that happens.
For this reason, even though the dashboards requirements are still a work in progress, there are some actions that trustees could usefully be thinking about now.
A good starting point would be to identify the scheme’s staging date and liaise with the scheme administrator to learn what they are doing to prepare for interfacing with the dashboards.
Trustees may also wish to consider the terms of the service agreement they have in place with their administrator. Do they need to be amended to cover provision of this new service? Who will bear resulting costs if things go wrong? How will data breaches be handled?
There is limited scope for trustees to defer their staging date — if, for example, they are planning to change administrator in the same period — but that is subject to certain specific requirements and so it is worth thinking about timelines for these projects now.
There will be other work to be done to get dashboard-ready, possibly over a fairly short time period. Thinking about some of the issues now will give trustees a head start on understanding what they need to do to meet their obligations.
Anna Taylor is a pensions partner at Taylor Wessing
