The Association of British Insurers (ABI) has called on the UK government to “urgently” reaffirm its commitment to enabling a thriving market of private sector pensions dashboards in its latest report.
According to the Department for Work and Pensions (DWP), there are approximately 3.3 million lost pension pots, containing £31.1bn worth of assets. Through the government-backed MoneyHelper dashboard, due to launch next year, the government hopes to recover £540m of lost pots and deliver a consumer surplus of £478m, contingent on 16.3 million users per year.
However, in its report, Unlocking pensions potential: The benefits of private sector dashboards, the ABI said it is “unrealistic” for MoneyHelper to generate those numbers by itself.
It highlighted that in 2023/24 it exceeded its target with 12.4 million ‘engaged sessions’ across all of its money and pensions guidance services, however, it said that it is unlikely to exceed that by 30% solely through its pensions dashboard.
Meanwhile, it said that if the market for private dashboards can flourish, 16.3 million users could be an underestimate.
This is mostly because the MoneyHelper dashboard will only be accessible via one website, with no plans to develop an app. The ABI said that users expect app-based, integrated digital experiences, so unless pensions dashboard data is available through services that people already use, its visibility and convenience will be limited.
The association added that private dashboards will equip users with the information and tools to take action regarding their pension. It explained this could be simple administrative changes, such as updating personal details, as well as making changes to contributions, accessing their pension, or consolidating pots.
The ABI went on to say that with rule changes, firms offering pensions dashboards could also offer regulated financial advice and, in the future, targeted support. It added that this will be delivered within strict regulatory standards, offering a “safe and consistent experience for users”.
It warned that offering pension information without the power to act may cause people to resort to less secure methods or be pushed towards unregulated sources of guidance.
In order to unlock the full potential of the dashboard, the ABI has called on the government to:
- publicly reaffirm its commitment to enabling private sector dashboards;
- provide an indicative timeline for application windows and key milestones;
- over time, work with regulators so that savers are able to take action with their pensions after using a private sector dashboard, in an environment that is safe and useful.
Emily Mae Collins, policy adviser at the ABI, said that private sector dashboards would be perfectly placed to complement the MoneyHelper dashboard, providing the tools to act
She said: “Integrating dashboards into the apps and services consumers already use can dramatically increase reach, and support people to understand their pension in the context of their wider finances. Before long, the rules should also enable people to make changes and do so safely – whether that’s saving more, consolidating pots, or accessing advice and new forms of support.
“Together, public and private sector dashboards can ensure that everyone, no matter where they are in their pensions journey, has the resources they need to plan for a better retirement.”
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