Crucial pre-launch testing of an ambitious state-backed project to help tens of millions of workers to keep track of their pension arrangements has fallen behind schedule, experts have warned.
Sources familiar with the pensions dashboard programme said the Money and Pensions Service, the organisation responsible, had not been able to meet all indicative timelines, including providing detailed testing requirements to the first tranche of pension schemes that are due to be connected with the central hub.
The first of more than 32,000 pension schemes are due to connect to the system by August 31 this year and face fines of up to £50,000 if they are late, as well as potential governance investigations by The Pensions Regulator.
Staging dates have already been put back by two months to give the industry more time but some pension providers say the timetable remains too ambitious, given the way that large, complex computer projects tend to throw up unexpected problems.
The dashboard is a wide-ranging plan to enable everyone to see all their accumulated pension savings, including the state pension, on a single screen. It also will help people to trace promised pensions from employers long in the past that they have lost track of.
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Pension pot proliferation is a growing issue in the wake of auto-enrolment, which requires all employers to enrol workers in a pension scheme.
The average worker has 11 different employers over their career and therefore potentially 12 different pensions.
The prize could be a huge benefit to consumers as they grapple with multiple pots and try to make sense of their finances in the run-up to retirement. But it is a massive undertaking involving multiple schemes, advisers and regulators, often working with imperfect data formatted in multiple ways and where confidentiality and protection from fraud is paramount.
“It’s a very, very tight timeframe for schemes and administrators,” Oliver Topping, associate director of Sackers, which advises large pension schemes, said. “My clients are telling me that the beta testing is meant to have started by now and hasn’t.”
The Money and Pensions Service is understood to be behind schedule on providing the detailed testing requirements that pension providers and schemes need to connect with the production ecosystem. Most pension schemes use administrators such as Capita, Willis Towers Watson and Mercer, which in turn are hiring advisers known as integrated service providers — including Intellica, Bravura and ITM — to connect with the central digital architecture of the pension dashboard programme under the auspices of the Money and Pensions Service.
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Schemes are required not only to provide accurate and formatted data to the central hub but also to respond to “Find” requests, matching beneficiaries against their own databases, sometimes using incomplete data. Even national insurance data is proving more difficult than expected, with some schemes reporting confusion over the final letter in their nine-character designation and expressing frustration that there is no central database against which to check their veracity.
The scheme has been set up so that there is not one dashboard provider but potentially dozens, each supplying information to consumers in an easy-to-understand format. Aviva, Moneyhub and an open banking financial technology firm called Bud are all said to be interested in becoming providers.
The Financial Conduct Authority is responsible for authorising dashboard providers, but it is still consulting on the rules, while The Pensions Regulator and the Department for Work and Pensions are also involved.
A work and pensions department study estimated the cost to the pensions industry of between £245 million and £1.48 billion.
A spokesman for the Money and Pensions Service said: “Delivering dashboards is a complex undertaking. The biggest challenge of the technical build is complete and we are now focused on preparing to connect pension schemes and providers. We’ve seen overwhelming support from the pensions industry so far.”
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Staging dates for schemes to connect with the system range from August 2023 to September 2024, with the public due to have its first access some time in 2024.
