Pensions Dashboards Delay and Costs Spiral

The National Audit Office (NAO) issued a scathing report late last week on costs and delays to the launch of pensions dashboards.

What are Pensions Dashboards?

This is a government driven project by the Department for Work and Pensions (DWP) now delegated to the Money and Pensions Service (part of the FCA) thereby funded by the regulated financial services industry to deliver a ‘one stop’ service where all your pension schemes including state pensions are displayed on one ‘dashboard’ for consumers to be able to view all their pensions in one place and to give a better, consolidated idea of what to expect for your projected retirement income.

Open Banking v Open Pensions

Open banking allows you to authorise external software providers, baking groups and apps to access your banking information and display bank account activity and balances from a range of bank accounts.  The Pensions Dashboard has the same goal but the problem is the complexity of pensions and pensions law in general as well as the huge range of different types of pension scheme as well as different levels of charges and fund availability for each pension scheme (even when with the same pension provider).

Delays and Costs

Pensions Dashboards were proposed in 2019 and then supposed to go live in August 2023 but this has now been revised to October 2026.  Originally costs were forecast at £235m in 2020, then up to £289m in 2023 and more likely £300m by the end of this year.  The NAO issued a scathing attack and suggested delays and cost increases are due yo a lack of digital skills and governance.

Comment

Pension dashboards will be a welcome addition for bothe advisers and consumers in planning action pre-retirement, building up awareness of likely financial positions and giving us the knowldege to understand whether we are on track for a secure retirement or likely to be disappointed and poorer without action.  That said, initial information will be limited but we suggest dashboards will develop with additional functionality to become essential tools for retirement planning with ability to take action, increase contributions, swicth funds, transfer, take corrective action and more to achieve a more secure retirement.

Given the complexities, as we always say “If it was easy, everybody would be doing it”.  Pension Dashboards are not easy to build given the millions of permutations, multiple systems and the number stakeholder firms involved.