The UK government’s path to establishing the UK pensions dashboard ecosystem has been long – with plenty of twists. But trustees who delay in getting ready for connection risk running out of road, writes Alex Lane of Eversheds Sutherland.
Almost all of the very largest schemes are well into the process of preparing to connect to dashboards – online platforms that will allow individuals to access information on their pensions in a single place.
The pensions industry is equally engaged advising on and implementing processes to cover every aspect of the new requirements, from deciding on a data matching approach to the tricky question of sharing information on additional voluntary contributions.
But as the Pensions Dashboard Programme motors towards receiving its first connectors – and a critical period of summer testing to dictate when dashboards will be rolled out to the public – many medium- and small-sized schemes are yet to devote significant time to their own connection projects.
The reasons for this inactivity can vary. Common themes include a view that the prior connection of larger schemes will help streamline smaller schemes’ connection projects, while there may also be uncertainty over whether the existing connection timeline will remain unchanged (it has already changed once already).
There is also a very real ‘capacity crunch’ among administrators and other third parties, upon which trustees will rely heavily for their compliance. This means some can struggle to get firm commitments on when work will begin.
The Pensions Regulator has made clear that all schemes to avoid potential pitfalls later. A ‘wait and see’ approach could be detrimental to trustees who may face regulatory consequences if they don’t connect on time, or if they don’t comply with all the requirements from their connection.
Making progress on dashboard connections
So what can trustees in need of a dashboard boost do to get themselves motoring?
Asking themselves, and others, the following critical questions now, could prompt action and save crucial time later.
- Who will the trustee rely on to achieve/maintain connection? Administrators, integrated service providers and additional voluntary contribution providers are all key stakeholders for connection.
- Is there a project plan place to connect the scheme to dashboards by the scheme’s ‘connect by’ date? Trustees and others will need sufficient time and resources to work through the key milestones and decisions they need to make.
- Is the scheme’s data in a state where it can be used to comply with the dashboard information requirements? Data quality and accuracy is key. Work to bring data up to scratch will need to be factored in.
- How will the trustees monitor and ensure compliance with dashboard rules at connection, and after the scheme has connected? Thinking about an appropriate contractual and governance framework at an early stage, rather than shortly before connection, means trustees have the time and leverage to ensure both are sufficiently robust.
Dashboards will be a critical project for most schemes during 2025 and 2026. Proactive and engaged trustees help ensure both a smoother route to connection, as well as a dashboard ecosystem that meets its goal of a UK population that is better informed and more engaged with retirement planning.
Alex Lane is a principal associate at Eversheds Sutherland.
