The 2016 Budget has not gone down as George Osborne’s finest hour, thus far. However, among the resignations, U-turns and widespread grumbling, there has been (at least) one positive development. The announcement in the Budget that the Government will ensure that a pensions dashboard is launched by 2019 has been the catalyst for action.
The Tax Incentivised Savings Association (“TISA”) has confirmed that it “intends to establish an industry run, not-for-profit facility based on open standards to facilitate the sharing of data and so enable firms to offer customers a pensions dashboard”. TISA does have a successful example of this type of industry run, not-for-profit facility under its belt, having been behind the set-up of the TISA Exchange (“Tex”). Tex is a key reason why the transfer of an ISA can be measured in days rather than the months it often takes to move defined contribution pension savings. Further, there is no reason why other dashboard providers/facilitators might not enter the market too but at least a start has been made.
Pension dashboards allow savers to have a consolidated on-line view of their various pension accounts, as demonstrated in the Netherlands, Australia, Denmark and Sweden. The combination of Automatic Enrolment and the end of a ‘job for life’ means that most employees will likely be members of multiple pension schemes over the course of their working lives. A dashboard will facilitate more holistic, and consequently effective, financial management and planning of these different accounts. The dashboard might also drive greater efficiency, nudging savers to consolidate their savings in a single account. The foundation provided by the dashboard might have a range of other uses, including as a communication portal driving greater engagement with savings.
I look forward to the pensions dashboard becoming a reality within this decade. The Chancellor has made a positive contribution in support of retirement saving in the UK – not a statement I’ve been able to make too often before! I am aware that this is only a single swallow but might it herald the start of a savings summer?