As the Financial Conduct Authority’s (FCA) consultation on the proposed regulatory framework for pension dashboard firms and the Pensions Dashboards Programme’s (PDP) consultation on draft design standards came to a close this month, investment consultant claim that it will be difficut for the UK pensions industry to prepare for a fully-functioning PDP platform.
Girish Menezes, head of pensions administration at Isio, said: “We welcome these consultations, but note that until we have clarity on them, it will be very difficult for firms across the industry to adequately prepare. Time is tight for third party administrators, who must make a vital decision about how they connect with the dashboard ecosystem, either directly or via an ISP [Integrated Services Provider].”
He noted that some pensions administrators will connect to the PDP ecosystem as early as Q4 this year and most by Q1 next year.
“Many will be connecting via an ISP service, which provides the layer necessary to deal with the large number of queries that are being predicted. But administrators currently have very little visibility of what the user journey for the dashboard will look like, which means they will likely have to make critical decisions blind,” Menezes added.
He said that for pensions administrators, the decision on which ISP to connect with constitutes the beginning of a long-term partnership and significant investment.
“Firms won’t want to make this decision without regulatory certainty around how dashboards will operate, and therefore what kind of experience they will be required to deliver for pension scheme members. Further, they will have little or no time for adequate testing,” he continued.
Menezes added: “With the dashboard going live later this year it is vital that the pensions industry has regulatory certainty as quickly as possible. Administrators need adequate time to onboard, test and learn with the fundamental systems that will underly the dashboard project. This will be critical to ensuring that they deliver something truly innovative and ultimately valuable to scheme members.”
Clear and objective information
Nigel Peaple, director of policy and advocacy at the Pensions and Lifetime Savings Association (PLSA) said: “It is vital that the information savers see on dashboards is presented clearly and objectively and does not influence their decision-making in a harmful way.
“The standards proposed by the PDP and are a very good start, but they will need to remain flexible as real-world experience from extensive testing informs communication approaches.
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