Trustees need to understand where the gaps are for their schemes and ensure they have a realistic plan in place to take the necessary actions before their staging date
As schemes continue to prepare for their staging date, the earliest of which is 30 April 2025, it is important to put yourself in the position of the individual user and not lose sight of the overall purpose of Pensions Dashboards.
Key messages as you get ready for Dashboards
1. Trustees are responsible
There is a risk to the service you provide to members and even possible fines if your scheme doesn't prepare correctly. You need to work closely with your advisers, but you are on the hook.
2. It's all about member experience
It's tempting to pigeonhole Pensions Dashboards as a technology project and there quite rightly needs to be a focus on technology, data and processes, but the ultimate goal is to have a positive impact on member outcomes. Schemes that get this wrong could have to cope with a significant increase in member queries.
3. Complicated cases need your attention
For many projects, it's appropriate to focus on getting it right for 95% of members and accept that some approximations might be needed for complicated cases. This won't work for Pensions Dashboards, where you need to be delivering the right information for every member.
4. It might already be urgent
Even though many trustees will be well underway with their preparations for connecting to Pensions Dashboards, building a website or setting up new calculation processes can take many months – part of your scheme's preparations may already be urgent.
An individual's (ideal) Dashboard journey
Individuals will first be 'matched' with their schemes, typically by entering their surname, date of birth and National Insurance number. While we don't yet know for certain what Dashboards will look like, we expect every individual who is successfully matched to be presented with a front page that sets out summary information about their pension entitlements along with a list of all their pension schemes from which they have not yet taken a benefit.
Our expectation is that selecting one from the list will bring up more detailed information for that scheme, including pension amounts, DC pots, retirement date and contextual information such as whether their pension increases in payment and whether there is a spouse or dependant pension after they die. A link to the scheme's website should also be provided.
Trustees are responsible for the data that individuals see; you need to ensure it is present, correct and meaningful. We expect a lot of the data to come directly from the member's record, so while virtually all schemes will need to carry out some data cleansing, getting this right should be achievable.
Perhaps a more interesting question is, 'Where on Dashboards can trustees control the member experience?' The answer is likely not very many places at all – the main trustee decisions might be how to calculate the pension amounts on Dashboards and what to put on the scheme's website.
Your scheme's website
If Pensions Dashboards do their job of getting individuals engaged with their pensions, we might expect them to have questions or to want to take further steps, such as getting a quotation. In many cases, this will mean that they end up on the scheme's website.
Given that many individuals won't have been on the website for a while, the ideal scheme website would let them reset their password without contacting the administrator; perhaps it even allows them to access the answers to some common Pensions Dashboards questions without logging in. Once they do log in, they would be able to view and update their details, access educational content, connect with a financial adviser and request a quotation.
In reality, we know some schemes don't yet have a website and those that do may not offer many of the 'self-service' features described above. Individuals who can't find the answers they need or get the right support are likely to contact the administrator – potentially in large numbers. High levels of Dashboard engagement could impact the day-to-day functioning of your scheme, including priorities like death cases and retirements. Controlling the member experience helps you to control your operational risks and reduces the risk of being overwhelmed.
Showing the right pension
Every member of your scheme will need to be able to see their pension amount at a recent date (and, for DC schemes, their pot). We expect most schemes to do these calculations for the majority of their members in advance, meaning that members can see them as soon as they access a Dashboard; if not, a member will be able to request it on demand and it must be made available within three working days for DC-only schemes and ten working days for all others. This is expected to present a problem for DB schemes, where benefits are generally more complicated, and more members will be non-standard.
Schemes that only focus on standard cases and rely on doing the complicated cases 'on demand' risk fines, delays and additional costs if member engagement is high. Paying attention to complicated cases reduces this risk.
Diagnosing your scheme: are you ready to connect?
If you haven't already, you should engage with your advisers to start working out where the gaps lie for your scheme. WTW's diagnosis tool splits the preparations into four areas:
Data Quality: How complete and clean is your data? Where are the gaps? Are there individuals who could be addressed before your staging date (e.g. those over retirement age)?
Calculation Processes: Can you calculate revalued/projected pension amounts (and DC pots) for everyone? How much of this can't be done in bulk? Would that number cause operational difficulties if initial engagement is high?
Value Data: How should you reflect your scheme's complexities when calculating pensions for Dashboards? Is the information provided on Dashboards consistent with what your members see elsewhere?
Member Experience: Do you have a scheme website, and does it have basic functionality, e.g. automated password resets? Do you have FAQs or a 'Dashboard explainer'? What other support do you want to provide to members?
In addition to knowing what actions you need to take, you will need a plan for completing them before your staging date. For some schemes, some preparations might already be urgent.
Prioritising your preparations for Pensions Dashboards will avoid negative experiences and minimise the risk of operational impacts and penalties, ultimately leading to better engagement and outcomes for your members
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.