How deferred DB pensions will look on pension dashboards

If you’ve read the previous instalments of the Dashboards Nine-Nine series, thank you.

You might reasonably think that, after all the complexities in the previous episodes around displaying defined contribution (DC) pensions simply for consumers, we’d be nearing the end of the story. But not so.

We’re now moving back to the 1990s, when I was still building up defined benefit (DB) pensions. 

Everyone who works in DB pensions administration knows well how this adds layers of complexity, for example around the revaluation to date of deferred pensions for display on dashboards. 

This is a big issue for millions of people in ‘Generation X’, like me, who are coming up to retirement over the next two decades. We have many millions of deferred DB pensions accrued in the 1990s and 1980s. 

Let’s dive into the fifth case study and explore some of the key issues around defined benefits, and the potential solutions. 

Pension 5: Centrica Pension Plan

My fifth pension is a deferred DB pension in the Centrica Pension Plan – despite me never having worked for Centrica. 

In the late 1990s I was employed by the Automobile Association (AA), working as part of its in-house pensions team. I was a member of the AA Management Pension Scheme. 

Centrica bought the AA in 1999, and as a result of that process it outsourced the entire in-house pensions team to Aon, making us deferred members of the AA Management Pension Scheme. After several name changes, it is now called the Centrica Pension Plan. 

(Aswe’vepreviously explored, corporate churn is another reason why consumers might not recognise the names of their different pensions.) 

The Centrica Pension Plan’s admin subsequently moved from Aon to Mercer, which has subsequently become Aptia. 

Are you keeping up? And, more importantly, do we expect most consumers to understand these continually changing names? 

My deferred Centrica pension

Aptia hosts a scheme website for the Centrica Pension Plan’s trustees where I can currently see my deferred DB pension, illustrated below. 

Notice how, underneath the greeting, this website display is already described as a pensions dashboard, even though it only shows one of my nine pensions. Perhaps we need another, better name for a service that actually shows all your pensions together? 

The £1,376-a-year DB pension shown is nearly 24 years old, i.e. it’s as at January 2001 when I ceased to be an active member. It’s common for deferred DB pensions to be quoted at date of leaving like this. 

As a consumer, of course, I don’t really care what my pension was over 23 years ago.  I want to know roughly what income I might actually get each year (or month) during my retirement. 

Aptia’s dashboards approach

The Department for Work and Pensions’ Pensions Dashboards Regulations require DB pension schemes to show deferred pensions revalued up to today, or to a date within the last year. How is Aptia doing this for the Centrica Pension Plan trustees?

Aptia’s head of pensions technical, John Wilson, told me: “Every year, as at the scheme’s anniversary date [31 March for the Centrica Pension Plan], Aptia will revalue and store all deferred members’ pensions, with another year’s increase added in.

“These stored values will then be available for return to any deferred member who makes a View Request from a dashboard.”

If I used a dashboard today, how might my deferred Centrica DB pension, revalued to the most recent anniversary date of 31 March 2024, appear on a dashboard? See the illustrative displays below. 

On the left is the mandatory ‘summary list’ screen, showing first my Aon Master Trust pension and then my Centrica pension. This example display illustrates how DC and DB pensions might be differentiated – for example, using different coloured information lozenges.

On the right is the mandatory ‘pension details’ screen, which might come up by tapping my Centrica pension on the list screen.

Notice how the £1,376 annual figure, from 2001, has now increased by almost £1,000 to £2,352. This is an uplift of around 70% due to inflationary increases over that 23-year period.

Revaluations and limitations

Why is it so important to see this revalued figure?

If I am targeting a particular total income and want to increase my contributions to my active Scottish Widows pension to meet that target, first I need to know the total income I’ve built up already across all my pensions, including the approximate revaluation on my deferred DB pensions.

Notice too that “What you could get in the future” and “Today’s figures” are the same: £2,352 a year.

There will be further increases, in line with inflation, between now and my potential ‘normal retirement’ in August 2032, but these increases are effectively ignored by dashboards regulations.

This means my £2,352 a year (£196 a month) figure shown is in “today’s money”, giving it a degree of parity with the £873 a month shown for my Aon Master Trust DC pension.

Testing with real consumers will show how well they understand all of this.

When and how will my Centrica pension be connected?

Given the size of the pension scheme’s membership, the Centrica Pension Plan’s staging date for connecting to the dashboards ecosystem is 30 June 2025. The trustees are making good progress with Aptia ahead of this connection date.

“Aptia’s matching protocols for schemes have been designed to maximise the number of pensions that are matched while minimising trustees’ exposure to risks of making false positive matches.” - John Wilson, Aptia

John Wilson said: “Aptia has built a new infrastructure to connect to the dashboards ecosystem, enabling us to better manage and monitor our links with dashboards than if we were to use a [third-party service provider].

“The new infrastructure includes a separate database to hold the data necessary for us to match against the verified identities of dashboard users, such as members of the Centrica Pension Plan.

“Aptia’s matching protocols for schemes have been designed to maximise the number of pensions that are matched while minimising trustees’ exposure to risks of making false positive matches.”

(You can watch a new video here explaining how GOV.UK One Login is used to verify users’ identities.)

Viewing my Centrica pension

Back in August, consumers were going to have a potential choice of nine dashboards. Now it’s potentially 15, with more being announced all the time.

This increase has been spurred on recently both by October’s ministerial statement re-committing to commercial dashboards, and by November’s final Financial Conduct Authority rules for potential dashboard operators.

This means I’ll have plenty of choice over which dashboard to use to view my pensions on.

Whichever dashboard I choose to use and view my Centrica pension on, if I want more help I might “click through” to the Aptia website, so Aptia is preparing to meet this uptick in demand. 

But one of the big unknowns about dashboards is how many users of different types will click through to their schemes’ websites, and with what types of enquiries. 

Extensive user testing from spring 2025 onwards will help illuminate this, enabling administrators like Aptia to finesse their preparations. 

Where next?

This is the final Dashboards Nine-Nine article of 2024 – thanks so much for sticking with me. I think you’ll agree there’s an awful lot to be discussed and settled prior to the public launch of dashboards.

When I’m back in January, there will be just four months to go until the first staging connection date.

In Episode #6, we’ll travel back further through the 1990s and cover two pensions in one article as I have two separate pensions in one scheme – presenting yet another interesting challenge for dashboards.

Seasons greetings, and see you in 2025!

Richard Smith is an independent pensions dashboards consultant.