In some senses the pensions industry is as predictable as the tides. No matter how many times the argument around single or multiple dashboards appears to have been put to bed, whenever it is queried it inevitably gets a fresh airing in the trade press.
Despite the debate, there is very broad support for multiple access points for pensions data. Which?, the UK’s premier consumer protection organisation, stated that “Multiple private sector dashboards could promote innovation, make it easier for people to find and use the dashboard and allow it to be integrated with other services”. A broad coalition of industry including providers, schemes, and the representatives of both the contract and occupational sectors all endorsed multiple dashboards in the 2017 report “Reconnecting People with Their Pensions”, recommending that: “To enable innovation, the Government must enable an “open pensions” infrastructure that allows consumers to access their data via regulated third parties”. Frank Field MP, the tireless warrior battling for consumer interest in his role as the chair of the Work and Pensions Select Committee, has endorsed the concept on the proviso of proper regulation being in place.His Committee recommended that, “With consent, authorised providers of financial services should be able to include an individual’s pensions dashboard data within their own applications.”
To my mind, there are two main reasons why multiple dashboards have always been and will always be the most appropriate policy decision. The first reason is that not everyone will use the Money and Pensions Service before they start planning for retirement. Some will use different dashboards for different reasons. If you restrict access to this information to a single dashboard then you are dramatically reducing the number of people who will access their pensions data, and how they can use it to take full control over their financial lives. If consumers want to see their data at the bottom through a financial wellbeing portal, who are we to stop them? Tools that integrate pensions information are already emerging: Lloyds Banking Group customers can already see their Scottish Widows Pensions, PensionBee customers can see their pensions via Open Banking apps, and employee benefit firms provide pensions data alongside other reward information. This is a positive development for pensions and it is only the beginning.
The second reason is that much like King Canute commanding the tide to stop, simply stating that there should only be one pensions dashboard does not make it so. (Canute was actually proving to his courtiers that the tide would not obey him – he knew what he could control, and therefore would probably have been in favour of multiple dashboards with a strong regulatory framework.) The experience of the current account market is that if you don't open up data silos, consumers will open them up for you in ways that you won’t expect. Screen scraping technology was used by customers to access their banking data, but that meant handing over their login details to a third party. The same is already happening in the pensions market, with firms pitching services to customers and to employers. This was addressed in banking by putting a regulatory framework around these Account Information Service Providers, and putting secure APIs in place via Open Banking to make the system work.
The lesson is clear: you can either create a system that allows well-regulated pensions dashboards to be created, or you watch pensions data open up in a piecemeal and inconsistent fashion. The Department of Work and Pensions could not have been clearer about multiple dashboards being set government policy, stating that “the delivery group should develop and build the dashboard digital architecture in a way which enables multiple dashboards which sit alongside a non-commercial offering”.
Put simply, you cannot hold back the tide of data portability, but you can put in place strong consumer protections to channel it for the wider good. This is consumers’ data and they have the right to access it in a manner of their choosing.