Public pension fund staging on dashboards could be set for delays

These concerns have been set out in responses to the Pensions Dashboards Programme’s staging call for input, which closed last month and asked stakeholders whether they were prepared for staging and what issues they were facing.

The Firefighters’ (England) Scheme Advisory Board said staging for the Firefighters’ Pension Scheme should only take place after the age discrimination remedy has been implemented and the first set of annual benefit statements have been issued successfully in Autumn 2024.

The dashboard is a good thing, but my concern is to make sure that we get a dashboard that works, is secure, and provides the members with something that’s useful. Because if it’s not secure, or useful, then members won’t use it and it’ll be a complete waste of time

Jeff Houston, LGPS Scheme Advisory Board

A separate response from the Local Government Association and the Local Government Pensions Committee said LGPS resources were “already over stretched with the pressures of the McCloud remedy and GMP equalisation”, and “the requirement to stage early will only add to this.” It added that recruitment and retention of staff remained an issue across the sector.

Jeff Houston, secretary to the LGPS Scheme Advisory Board, explained that McCloud will involve a data collection exercise because the scheme will have to recreate final salary service, which they have not had to do since 2014 when career average revalued earnings was introduced.

“If we have to do anything different for the dashboard, that takes away the resources to actually do it, whether it’s intensive data gathering or the available people to change our systems. Across both the LGPS and fire schemes, we use a very small number of software providers, and they have limited resources within themselves for development.”

Even without the McCloud changes, there could be delays if funds need to provide data that is not provided on the ABSs.

As Houston said: “It is a bit of chicken and egg because they’re asking us when we can stage — to which we respond, ‘Well it depends on what you want from us in terms of data’. If they just want information on the ABSs, then we can probably go fairly quickly, within the next 18 months to two years as the government envisages — we can probably hit that. The smaller the call for detailed data, the earlier we can stage. If they want anything else above what the funds already provide on ABSs, then you’re talking about extra time in terms of developing our systems, and we’ll have to make sure that data is correct.”

There is a risk that introducing the dashboard when the information is not McCloud-compliant could be counter-productive and limit members’ understanding of the value of their pension benefits. The firefighters’ board voiced this concern, pointing out that both its employer and employee representatives believe that “members’ priorities rest in being able to access information on the benefits they are owed via McCloud/Sargeant implementation, rather than accessing information via the dashboard”.

The firefighters’ scheme’s McCloud remedies will require members to make a choice as to whether they will be better off having career average or final salary.

“Part of that will involve looking at the benefit statement, and, potentially, what they see on the dashboard. If those two things are different, we are going to confuse even more a very complex position for that member,” said Houston.

The LGPS’s position is different as it will make the decision on behalf of members as to whether they are better off with final salary or career average.

“If the member has to make a choice and there’s been any confusion during that decision-making process, it will just lead to potentially more challenge,” Houston added.

The LGA and LGPS’s response said clarity is needed on whether the information the LGPS provides on annual statements will have to take account of the McCloud remedy, and from when it would apply. Their point is that changes to pension software systems must go hand in hand with software changes required for the dashboard.

“Because of the lack of certainty, there is the possibility that dashboard data could be different to the data that is included in the annual statements when the data becomes publicly available. This could undermine the value of pensions dashboards and potentially cause a considerable amount of work for LGPS administering authorities in queries,” said the response.

When asked whether the LGPS had appetite for staging early, Houston said it would help if PDP could limit the amount of view data that must be supplied initially.

Houston said that while allowing members to access information about different pensions in one place is “brilliant”, it is a question of making sure it is done properly. “The dashboard is a good thing, but my concern is to make sure that we get a dashboard that works, is secure, and provides the members with something that’s useful. Because if it’s not secure, or useful, then members won’t use it and it’ll be a complete waste of time.”