The government must ensure the vast majority of schemes, including defined benefit schemes, participate in the pensions dashboards from day one, according to AJ Bell.
In response to the government’s ongoing call for input on the scope and data requirements for dashboards, the firm called on policymakers to also ensure state pension information is available on the initial dashboards, as it is the “foundation” on which most retirement plans are built.
It warned that launching the dashboard with missing information or data errors would risk “fundamentally undermining” trust in pensions, arguing that ensuring all information is accurate and complete will be “critical” in gaining legitimacy.
AJ Bell senior analyst, Tom Selby, stated: “The world may have changed beyond all recognition in 2020 but the problem of people losing track of old pensions has not gone away.
“Over the long term, pensions dashboards have the potential not only to reunite people with lost pensions but also to drive greater levels of engagement and in turn value for money.”
He argued that it is therefore “crucial” that the first versions of the dashboard include the majority of pension schemes, noting that the state pension acts as the “foundation” on which most people’s retirement plans are built.
He added: “And while some schemes, such as those operated within the public sector, may struggle administratively to link up with dashboards, all available evidence suggests attaining full coverage will be vital to building trust in the service.
“This will be much more useful to savers than rushing out half-baked dashboards that risk misleading people about the pensions they have.
“Data security is also obviously incredibly important and providers need total confidence that the data of customers matches the request being made by any dashboard before that information is shared.”
Pensions Minister, Guy Opperman, previously wrote to pension schemes to gather evidence on how ready they were to submit good quality data for the future introduction of the pensions dashboard, emphasising that “the need for pensions dashboards is stronger than ever”.
— to www.pensionsage.com