The Pensions and Lifetime Savings Association (PLSA) welcomes the Money and Pensions Service’s (MAPS) Pensions Dashboards Programme’s (PDP) progress update, particularly its commitment to work with the pensions industry to arrive at a set of data standards that are appropriate to the needs of savers and the many different types of pension arrangement that exist in the UK.
Today’s progress report indicates for the first time the types of information savers might be able to access on pensions dashboards.
The PLSA has consistently argued that initial dashboards should include an estimated retirement income. This would make it easier for savers to compare different types of pension provision they may have (e.g. state pension, defined benefit and defined contribution arrangements) and could encourage better savings choices. For defined contribution savers, research shows that where they are presented with a retirement income estimate rather than just a pot size, they were significantly more likely to: engage with their retirement savings and make additional voluntary contributions.
The Pensions Dashboards Programme recognises the need to take in the broadest possible range of experience from across the different types of pension arrangements before making any final decisions on the data standards. Representing trust-based schemes, defined benefit, defined contribution, Master Trust and Local Government Pension Schemes, the PLSA is well-placed, and pleased, to provide support to the Programme.
Today’s documents make it clear that there is likely to be a staged approach to bringing schemes on to dashboards and a phased approach to the data schemes will be required to provide to dashboards, with a small number of common items being mandatory for all schemes from the beginning.
Nigel Peaple, Director of Policy & Research at the PLSA and a member of the PDP Steering Group, said: “This progress update shows the Pensions Dashboards Programme is taking an evidence-based approach that puts the needs of savers first and respects the practical challenges pension schemes are likely to face. It is particularly welcome the Programme is committed to developing these standards in collaboration with the industry and through consumer testing. This is the sort of proportionate approach that is necessary to ensure dashboards work in the interest of savers.
“Given the exceptionally challenging environment posed by the Covid-19 pandemic, the PLSA agrees with the Pensions Dashboards Programme that it is best to defer the formal consultation period until the Autumn so as to ensure extensive and deep engagement with the sector.
“The Dashboard programme has the full support of the PLSA. Recent PLSA research showed over half of workers (54%) do not know the current size of their pension – we must make it easier for people to understand their pension savings.
“Supported by planning tools, such as the PLSA’s Retirement Living Standards, Pensions Dashboards offer a major opportunity to help savers picture their future and achieve a better income in retirement.”
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