The Pensions Dashboards Programme (PDP) is aiming to publish an initial version of the data standards for pensions dashboards at the end of the year.
In an update following the closure of its call for input on data standards on 31 August, the PDP also said that it plans to publish a summary of the 50 responses it received, in the autumn.
PDP head of industry liaison, Richard Smith, thanked the industry for their input and outlined three key areas of activity from the Data Working Group, which was convened earlier in the summer.
He noted that getting the data standards correct would be “challenging” and are likely to evolve over time.
“There will need to be a continual loop of user testing and refining the data standards, ensuring that users can understand the information that they’re being presented with on initial pensions dashboards, whilst also reflecting (at an appropriate level of detail) the key underlying complexities surrounding their pension entitlements,” Smith stated.
Additionally, Smith warned that sophisticated approaches to matching would be required to enable full coverage.
He noted that although many providers and schemes believe they will be able to match members’ pensions against their national insurance number, date of birth, and one other data item, there are issues around the accuracy of some national insurance numbers received from employers or inherited from previous administrators.
Furthermore, he noted that individuals can often fail to notify their pension provider if they move house or change name.
“Unless schemes are able to positively match against all these items, they will be reluctant under data protection rules to return pension information for the individual to view on their chosen pensions dashboard,” added Smith.
“However, when an individual uses a dashboard, this may create an opportunity to correct such data anomalies through existing data processes, which is good for both the individual and the scheme.
“But this will have to be done incredibly carefully to ensure the security of the individual and their data at all times. These data processes will need to be extensively tested with test dashboards and volunteer schemes from next year.”
Finally, Smith emphasised the important of displaying estimated retirement incomes for each pension on the dashboards, but warned the can be “extremely problematic”.
Pension providers and schemes will have to supply these estimates, as stipulated in the government’s April 2019 consultation response, and Smith noted that many defined benefit schemes do not show retirement income estimates on annual statements, instead directing members to scheme-specific retirement calculators on their websites.
For defined contribution (DC) retirement income estimates, Smith noted that many stakeholders feel that showing different statutory money purchase illustration incomes from different DC pots is “problematic for several reasons”.
“By the end of the year, we will be publishing the first version of data standards for subsequent user testing. This means that pension schemes and providers can begin to act in earnest,” Smith said.
“Whilst it won’t be easy, the significance of pensions dashboards in supporting better planning for retirement and growing financial wellbeing should not be underestimated and we should all therefore remain fully committed to the quest.”
— to www.pensionsage.com