LGA calls for 2025 dashboards deadline amid capacity crunch fears

The Department for Work and Pensions’ consultation into draft dashboard regulations, in which it reiterated that ‘find’ and ‘view’ functionality should be available from launch — despite worries about its feasibility — was met by a wave of concern from across the industry about the ambitious requirements it contained.

Many industry commentators expressed doubt that public sector schemes in particular could be onboarded by their current staging date of April 2024, and the LGA has now added its voice to the chorus, warning that a combination of factors make it unrealistic to expect firefighters’ pensions to be included on the dashboards by the required date.

If meaningful data is not available it is highly likely that the preferred approach for the LGA will be to discourage the use of dashboards

Jeff Houston, LGPS Advisory Board

As with other public sector schemes, the LGA pointed to the workload entailed by the McCloud remedy, explaining that FPS administrators will already be under “huge pressure”.

The is also a chance that a second options exercise will be under way in the scheme, in line with an agreement between the government and the Fire Brigades Union, announced on February 14, to resolve a long-running dispute over the pension benefits available to retained firefighters.

The LGA argued that neither a remediable annual benefit statement nor a remediable service statement including McCloud data will have been produced before the public sector staging deadline of April 2024, meaning it would not be possible to provide more than one figure to the dashboards, potentially leading to inaccurate or incomplete information being presented as the dashboards would not account for the member’s position under the deferred choice underpin as required by the McCloud remedy.

“Providing members with incorrect or incomplete information could undermine the credibility of the dashboards and decrease member engagement,” the LGA said.

It suggested that treating the FPS as a medium-sized scheme would better accord with the way the scheme is run — it being a locally administered scheme that in many areas has fewer than 1,000 members — and would also allow for a staging deadline of April 2025, which would be more realistic.

Jeff Houston, head of pensions at the LGA, wrote in response to the consultation: “The LGA would like to support the [Pensions Dashboards Programme] by ensuring that the dashboard is thoroughly communicated to fire scheme members. However, providing members with incorrect or incomplete information could undermine the credibility of the dashboards and decrease member engagement.

“Should the staging date of April 2024 remain, it is likely that we will not be able to support any communication exercise. Furthermore, if meaningful data is not available it is highly likely that, in order to minimise queries for both [fire and rescue authorities] and administrators, the preferred approach for the LGA will be to discourage the use of dashboards as the information held will not be accurate in representing a member’s current [deferred choice underpin] position.”

Will government revise timeframes?

In its response, Sackers likewise called the current staging timetable “ambitious”, even for the larger schemes (currently due to be onboarded in 2023). 

“Occupational pension schemes are not commercial entities and they have finite resources. They are also highly reliant on the co-operation and availability of their advisers when it comes to many of the obligations which will be imposed on them under the draft regulations,” it said.

“The staging timeframe currently proposed could therefore prove extremely challenging for most schemes. Having recently emerged from nearly two years of a global pandemic, schemes are also having to grapple with a number of competing work streams, both ongoing and on the horizon, including in relation to GMP equalisation, the new transfer regime, stronger nudge requirements, the single code and the new DB funding regulations and code of practice.”

Sackers called on the government to provide an interim update “at the earliest opportunity” as to whether it intends to revise the timeframes in light of industry concerns, or to “simply press ahead with its current proposals”.

Sackers partner Emily Forrest argued that, whatever the event, the government and regulators should tailor the compliance regime with this significant workload in mind.

“With the industry still dealing with the aftermath of the pandemic, and any number of developments and projects which have been delayed as a result, there is little time to get ready. We therefore think it would be helpful if TPR could confirm that it won’t take any enforcement action until dashboards go live,” she said.  

“This would give the industry more time to work through the dashboard requirements and ensure that the underlying data is ready for the public.”

She continued: “DB benefits in private pension schemes can be very complex. As currently drafted, the regulations could leave trustees exposed to liability if the simplistic valuation required to be placed on such benefits is left unexplained.

“We suggest that trustees should be able to include tailored commentary alongside all value data, as well as it being made clear in the regulations that any information provided to the dashboards is only illustrative in nature and remains subject to the scheme’s rules.”

Capacity crunch could lead to non-compliance

The Association of British Insurers likewise stressed the importance of an accommodating compliance regime, especially as the first stage of onboarding could lead to a capacity crunch.

“The programme’s onboarding plan has long been relying on firms to voluntarily onboard early to reduce friction during the official onboarding window. However, the DWP regulations do not explicitly provide legal basis for firms to voluntarily onboard this year,” it explained.

“We are concerned that, as a result, beta testing planned this year will not be able to attract sufficient participants. This might lead to an overwhelming amount of data being connected within the first cohort and we are uncertain whether [the Money and Pensions Service] might have the capacity to handle these requests.

“Cross-industry co-ordination by the PDP is required outside of the regulations to ensure that providers can onboard on time; and the regulations should allow for non-compliance if it arises from a dependency on a third-party, including Maps.”