Pensions dashboards standards need ‘extensive user testing’ – Law & Regulation

The Department for Work and Pensions intends for the dashboards’ legislative framework to come into force from April 2023. The Pensions Dashboards Programme’s consultation, launched on July 19, sought input from the pensions industry on areas including operational, security and design standards.

The Pensions and Lifetime Savings Association and the Society of Pension Professionals were among respondents to the consultation, which closed on August 30.

The PLSA welcomed the clarity offered by the PDP’s standards but lamented that the consultation did not run for at least eight weeks over the summer, which the body said would have helped organisations to provide fuller feedback.

We would have preferred them to have been developed after extensive user testing, with real connected pension schemes

Pensions and Lifetime Savings Association

The SPP, meanwhile, said that “the solutions being proposed largely seem reasonable”, but added that until they are tested “using real data and structures, it is not possible to say for certain whether they are the best solution or not”.

The market is only just emerging

Efforts have been made to incorporate the views of the industry throughout the dashboards’ development process. 

In July, the DWP was told by respondents to its own consultation that the timeline for making the initiative accessible to the public is too short. There will be a 90-day period between the point at which the dashboards will be available to the public — known as the “dashboards available point” — and their announcement.

While welcoming the standards, the PLSA told the PDP: “We would have preferred them to have been developed after extensive user testing, with real connected pension schemes, to achieve balance between a good, comprehensible user experience and what is technically feasible and not onerous to data providers.

“Our main concern, and that of our members, is that many of the questions are best answered by an [integrated service provider] market that is only just emerging and [qualifying pensions dashboard services] that do not currently exist. 

“Pension schemes have only just started to engage with ISPs and not all have had discussions at the level of detail to know if these standards are set at the right level.”

The PLSA warned that there are “still many” parts of the dashboards’ lower-level design that have yet to be finalised. 

Large schemes will be the first of three staging cohorts, connecting to the dashboards’ digital architecture between April 2023 and September 2024. 

They will then be followed by medium schemes throughout October 2024 to October 2025, with small and micro schemes expected to connect from 2026.

For the first cohort of dashboard providers, “not having finalised standards until late 2022 could place a significant risk of schemes’ ability to implement a solution in a controlled fashion”, the PLSA cautioned.

View request response time is ‘too tight’

The PLSA and the SPP were united in their views on proposed service levels for the dashboards. The consultation admitted that a standard requiring responses from providers to individuals seeking to see information about each of their pensions within two seconds “may, however, create a barrier to calculating real time values for some providers”.

The PLSA’s members have said that this benchmark on “view requests” is “too tight and is likely to discourage them from doing real-time calculations”.

“Allowing data providers to either deliver view data in two payloads (the first in two seconds, the second with a longer response time) or allowing 10 seconds for the return of view data including real-time calculations would make this feasible,” it continued. 

“This is where understanding the whole user experience from dashboards will help us to know if 10 seconds would be acceptable.”

The SPP agreed, suggesting that “consideration should be given on what should be presented to users while the view information is being obtained”. 

This could include icons that help to make a user’s wait feel shorter, it proposed.

More consideration needed for small pots

The PLSA set out a list of areas for further consideration, suggesting that work is needed on the standards that govern additional voluntary contributions, small pots and reporting requirements.

It said that the standards covering the “interlinking” of defined benefit schemes and additional voluntary contributions need more thought. 

Estimated retirement incomes and accrued income data for AVCs “that are designed to maximise tax-free cash could be misleading on pensions dashboards”, the response said. 

“There are also concerns in respect of a misalignment of matching criteria between schemes and AVC providers, which might mean that one scheme is shown and not the other,” it added.

The body also urged more consideration for pot sizes under £2,000, where statutory money purchase illustrations usually round down income figures to zero. 

“This may be a counterproductive experience for the user, and thought may need to be given to a warning that explains the income is less than £100 rather than present a zero figure for ERI and accrued income,” the PLSA said.

In its own response to the PDP’s consultation, the Pensions Administration Standards Association said that the basis for ERI “isn’t prescriptive enough” and warned of a plausible inconsistency in the way benefits are presented to users, which could “potentially even misrepresent benefits as no wider context is given”.

Reporting requirements are ‘too onerous’

The PLSA warned that the reporting requirements seem “too onerous” for data providers. According to the PDP’s consultation, management information and oversight data are to be provided daily.

“Our members have not been able to grapple with the full list of reporting requirements, finding the information required confusing,” the PLSA said.

“Members who are connecting directly to the pensions dashboards’ ecosystem have questioned the need for all of the reporting requirements and for this information in real time and daily,” it added. 

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“This could increase the costs of governance considerably without a true understanding of the benefits.”

The Investing and Saving Alliance told the PDP that “further information is required for complaints reporting”, noting that “the bespoke nature of these mean the lower-level detail is often not stored on administration systems”. 

It called for worked examples to help schemes understand their obligations in response to complaints.

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