Pension statement season = an analogue solution in a digital world – which wouldn’t even achieve much in an analogue world
— Steve Webb (@stevewebb1) October 12, 2021
Steve Webb can be brutal, especially when he’s on home ground. Government and industry affairs is home ground and he can see the discomfort the Pension Minister has with the failure to deliver digital solutions in a digital world.
You can join in this debate on Friday 22nd October by registering here
The Pension Dashboard was a Treasury initiative that emanated from the white heat of fintech when Steve Webb was still a minister. If the Treasury had handed the pension dashboard to Fintech entrepreneurs they would have got open pensions by now. But Government knew that this would have been a huge risk as it might have disrupted the smooth operation of our multi-trillion pound tax incentivized savings industry and might have opened doors to some unsavory scammers.
So the keys to the dashboard project were put in the drawer of Charlotte Clark and the DWP policy team and after Esther McVey did her best to throw the keys away, they eventually found their way to the Single Finance Guidance Body which became MaPS who set up the Pensions Dashboard Program.
Which is why we don’t have pension dashboards nor are likely to – till 2025. We may get the MaPS pension finding service in 2024 when the Dashboard Availability point is reached but this is dependent on co-operation between sufficient providers to satisfy Government that the vast majority of pensions can be accessed with a single login. When you think that this is likely to include rights to DB and the State Pension, you can see why a “Digital solution for a Digital world” is a way away.
In the meantime, we have simple statements and a simple statement season, which is a bit like a peddle cart Ferrari. It looks good but it doesn’t quite match the real thing.
Toys R us
I am staying away from Lamborghinis in this conversation, but I’ll stick with the toy Ferrari as, like the simpler pension statement it can deliver in a limited but stylish way. If you got a few of these coming along at once you could have a toy Ferrari rally and see all the toy Ferraris in one place.
Let’s not get carried away, Steve Webb is right in saying that simpler statements and a simpler statement season are not the real thing – anymore than Toy Ferraris are the real thing. But they do at least make for a conversation about cars – or about pensions (as this blog is trying to do).
Because what matters with a simple pension statement is that it delivers information in a relevant way,
The observant will have noticed that they are looking at a 2018 statement – 3 years after going into pilot, we are now about to go into mass production and the point is that all pension statements will be arriving at about the same time showing different numbers in the same way.
And though we may mock this from our Fintech sentinels, for the average person, getting something intelligible and consistent about their pensions is a step in the right direction, a step towards the dashboard.
So we can be thankful for small mercies and while grinding out teeth about dashboards, recognise that a Toy Ferrari is better than no Ferrari at all.
Don’t sit on the pavement – get out on the road!
That we have got a simpler pension statement and a standard way of delivering it is very much down to the efforts of one man – Ruston Smith.
I’m very pleased that Ruston is going to be speaking about statements and how they can show people both the value of their pension saving and the money you pay out of your savings. This is as part of our value for money seminar at 2pm on 22nd October and it will feed into a discussion of just how we measure value in our pension savings with the DWP, tPR and FCA.
Also speaking will be Janette Weir who has piloted various pieces of information on single statements to find out what people want to be told. Janette runs Ignition House and her study group were Tesco employees. It should be a fascinating session not just for those who will be designing and delivering the annual statements, but to those who are looking forward to the pension dashboards.
I will be sending Sir Steve Webb an invite. You can invite yourself by