Government consultation on draft regulations for the implementation of pensions dashboards has begun. The consultation closes on 13 March. As a reminder, pensions dashboards will allow an individual to view information about all their pension savings (including their state pension) on a single website, even where the individual has savings in multiple pension schemes. The Money and Pensions Service (“MAPS”) will provide a non-commercial dashboard, while other entities will also be able to provide dashboards if they are authorised by the Financial Conduct Authority (“FCA”) to do so. Any such providers will need to meet standards that are set out in the draft regulations.
Broadly, trustees will have to meet requirements relating to: (a) cooperation and connection, (b) provision of pensions information and (c) record-keeping and reporting. In meeting these requirements, trustees will need to comply with standards to be issued by MAPS and have regard to guidance to be issued by the government and the Pensions Regulator (the “Regulator”). The requirements only apply to schemes with 100+ active and/or deferred members.
The staging timetable will be based on scheme size and type and will run from June 2023 to October 2025 as follows:
- June 2023 – September 2024: large schemes, meaning master trusts and schemes with 1,000+ “relevant” members1.
- October 2024 – October 2025: medium schemes, meaning schemes with 100 – 999 relevant members.
DC schemes that are being used for automatic enrolment will have earlier staging dates than other DC schemes, DB schemes and public service schemes. Where the scheme is a hybrid scheme, the earliest of the applicable staging deadlines applies. DB schemes which provide DC additional voluntary contributions are treated as DB schemes if the scheme does not provide any other DC benefits.
Schemes must connect within the month leading up to their staging date. However, master trusts with 20,000+ relevant members must connect within the three months leading up to their staging date.
Schemes can apply to MAPS for permission to connect early or voluntarily. Schemes can also apply to the government for permission to defer their staging date provided that (a) they apply within 12 months of the regulations coming into force and (b) they have not previously deferred their staging date. If deferral is granted, it will be for a period of no more than 12 months.
Schemes with less than 100 relevant members are not required to connect, but can choose to do so with the consent of MAPS and the Regulator. The government’s intention is that such schemes will be required to connect at some point in the future and it expects this to be in 2026.
Cooperation and connection
Trustees will be required to:
- Register with MAPS and cooperate with it in the exercise of its functions in relation to pensions dashboards.
- Connect to the dashboard ecosystem by their scheme’s staging date. Trustees must retain for six years records of the connection steps that they have taken.
- Ensure that their scheme remains connected to the dashboard ecosystem unless an exception applies. The main exception is when all the members of the scheme become pensioners. Where a scheme does disconnect, the trustees must notify MAPS immediately.
- Notify MAPS of any connection state changes, such as scheduled downtime or maintenance, or systemic issues, such as cyber-attacks that could affect the security of the dashboards ecosystem. Schemes must also notify MAPS of any change in connection arrangements.
Trustees will also need to complete a number of pre-connection steps which will be set out in standards to be published by MAPS.
Provision of pensions information – “find” requests
“Find” requests are data relating to an individual that schemes will be required to use to “match” the individual with a scheme member i.e. to identify whether that individual is a member of the scheme.
In relation to find requests, trustees will be required to:
- Decide on criteria to use for matching find requests.
- On receipt of a find request, complete matching. Where there is a match (i.e. the find request is from an individual who is a member of the scheme) and the member is not a pensioner, trustees must create and register a pension identifier with their resource server and MAPS.
- Where a match is made, but the member subsequently leaves the scheme, de-register the pension identifier from their resource server and MAPS.
Provision of pensions information – “view” requests
“View” requests are requests for the scheme to provide data relating to an individual in respect of whom a match has been made.
Where a match is made and a view request is received, trustees must check with MAPS that the member has consented to their view data being provided. Assuming that consent has been given, trustees must provide “view data” to the pensions dashboard service that issued the view request. The data to be provided will include:
- Administrative data such as the scheme name, the nature of the member’s benefits, the date they joined the scheme, the name of the scheme administrator and their contact details, and information about the employment that gave rise to the pension.
- Signpost data in the form of the website address where the member can access the scheme’s statement of investment principles, implementation statement, and (in the case of schemes providing DC benefits) information on member-borne costs and charges.
- Value data which is essentially accrued and projected pension values, with accompanying contextual information such as the illustration date, whether the value given is regular income, a lump sum or a pot value, whether the value given has attaching spouse’s/civil partner’s or dependants’ benefits, and whether the value given would increase or remain flat once in payment.
Administrative and signpost data must generally be provided immediately on receipt of a view request. Value data must be provided immediately if it has been generated for a benefit statement in the last 12 months or, if it has not, within three days in the case of DC benefits and within 10 days in all other cases.
Record-keeping and reporting
Schemes must keep records of a range of “management information” for at least six years, including the number of find requests received, the matching process used by the scheme, and the number of view requests received and the time taken to respond to each one. Trustees must provide management information to MAPS, the Regulator or the FCA on request.
Compliance and enforcement
The Regulator will be able to issue compliance notices to trustees and third parties directing them to take, or refrain from taking, the steps specified in the notice. The Regulator will also be able to issue penalty notices to trustees and third parties. The maximum penalty will be £5,000 in the case of an individual and £50,000 in all other cases.
Trustees and administrators should:
- keep progress of the consultation under review; and
- start planning for the introduction of pensions dashboards.
The Pensions Dashboard Programme, the body responsible for developing the pensions dashboard ecosystem, has published a range of guidance to help schemes prepare. The Pensions Administration Standards Association has also published guidance for schemes, including a summary.
For more information, or advice in relation to the pensions dashboards requirements, please speak to your usual Mayer Brown contact.