As the consultation on pensions dashboards concludes on 13 March 2022, advisory firm LCP highlighted that the current proposals could end up creating “dumb” online platforms.
This is because, at least at the very beginning, consumers will have very limited use of the dashboards as firms will face restrictions in the way data can be presented or manipulated.
The consultation says this is to “build trust and confidence in the information shows”.
Users will be allowed to “export their data away from the dashboard, either to another page within the provider’s system, or beyond”.
LCP warned this could result in clients taking their data somewhere else which could expose them to risks of scams.
Steve Webb, partner at LCP said: “The desire to protect consumers is understandable, but if this results in ‘dumb dashboards’ then this could do more harm than good. Simply seeing all your pensions in one place is the start of a journey not the end.
“If dashboards themselves are severely restricted in the support and services they can offer, consumers will simply take their data elsewhere, almost certainly to a less regulated environment. The best antidote to scammers and poor choices is to provide more help and guidance within the dashboard environment, rather than to drive people off.”
Start small
But not all agree with Webb’s assessment.
Tom Selby, head of retirement policy at AJ Bell, told International Adviser that even if dashboard will have very basic functions to begin with they would still be helpful to consumers.
“Dashboards are edging closer to becoming a reality but anyone expecting them to be all singing and all dancing on Day 1 is likely to be disappointed. In reality the first versions of dashboards are likely to provide a fairly basic ‘find and view’ service, with add-ons designed to facilitate greater levels of engagement expected in the future.
“It’s important to note that a find and view service in and of itself will be useful for lots of people, although it won’t offer all the tools they might need to make better-informed decisions about saving and ultimately retiring. This is part of the reason why extensive user testing and clear communication of what dashboards do and what they don’t do will be absolutely vital.
“The primary focus for government, understandably, is ensuring the data presented on dashboards is accurate and safe, and that the technology works as intended. This should provide a platform from which greater levels of engagement can hopefully be built in over time.”
Growth
Kate Smith, head of pensions at Aegon, agrees with Selby as she told IA that the dashboard should start small and then grow in scope over time
“Pension dashboards will enable people, at their time of choosing, to see all their pension online securely, ” she added. “Consumer protection is a key principle of pension dashboards. The idea is that people will always be in control of who has access to their data.
“The dashboard ecosystem will support advice and guidance by permitting delegated access to regulated financial advisers with permissions to advise on investments and pensions. As an alternative, individuals will be able to choose to export their dashboard data to advisers or others, which introduces a potential scam risk if data is shared outside the regulated environment. The safest way for individuals to share their dashboard data will be via the delegated access route.
“Dashboard data will be prescriptive to enable people to compare consistent data, regardless of which dashboard they choose to view their data.
“We’re supportive of the concept that dashboards should start small and grow in scope and capability over time. We expect that dashboards will be built into providers’ customer journeys, with online tools and helpful communications sitting alongside. In time, these may be included on dashboards as people become more confident with using dashboards.”
