Voluntary connection to the pensions dashboards ecosystem: your feedback needed

The Pensions Dashboards Programme (PDP) is working to enable individuals to view all their pension information online, securely and in one place. For this to become a reality, pension providers and schemes must be connected to the ecosystem we are building that makes dashboards work.

While the vast majority of pension memberships in the UK will be covered by those pension providers and schemes which are required to connect to the pensions dashboards ecosystem under the dashboards legislation, some fall outside these legal duties. However, eligible schemes which are not subject to the legal requirement to connect may apply to the Money and Pensions Service (MaPS) to connect on a voluntary basis.

This article outlines what voluntary connection involves, who may apply, and why it might be beneficial for schemes and their members. We also call for your feedback to help inform the process and its timeframe.

Who can apply to connect voluntarily

Eligible occupational pension schemes that are out of scope of the legislative framework for pensions dashboards may choose to connect to the dashboards ecosystem.

If all of the following conditions apply, a scheme may submit an application to connect voluntarily:

• the scheme has at least 1 but fewer than 100 active, deferred or pension credit members
• the scheme has at least 2 members in total (in any category of membership)
• the scheme is a registered pension scheme for tax purposes
• the scheme has its main place of administration in the United Kingdom

Why connect voluntarily

By choosing to connect to the dashboards ecosystem, pension schemes will enable their members to find and view their pension on a dashboard. This may help improve member engagement and provide schemes with an opportunity to update and improve the data they hold.

Though most memberships will be covered by those connecting to dashboards under the legislation, having eligible schemes connect voluntarily will help extend dashboards coverage further. This will improve the experience for many dashboard users, giving them a clearer picture of their estimated retirement and helping support better financial planning.

It is also worth considering that consumers increasingly expect to manage their financial lives online. Pensions dashboards will allow users to view their pension information online, together in one place. Connecting to pensions dashboards may help schemes demonstrate a commitment to transparency and innovation.

Things to consider

Trustees and managers of schemes are responsible for the decision on whether to apply to connect voluntarily, and should take the following points into consideration.

Schemes applying to connect voluntarily are required to have regard to PDP guidance on voluntary connection. When MaPS grants applications for voluntary connection, this brings the scheme into the same legislative framework as for schemes required to connect under the dashboards legislation, and the scheme will then need to comply with the standards for pension providers and schemes.

All legal requirements for dashboards will apply to the pension scheme from the date they connect to the pensions dashboards ecosystem. Failure to comply with these requirements would be a matter for The Pensions Regulator (TPR), as set out in their compliance and enforcement policy.

As well as legal duties, schemes should also consider the work involved in not just connecting, but in remaining connected to the pensions dashboards ecosystem. Once dashboards are publicly available, schemes will need appropriate resources in place to handle pension find requests from users and to respond with accurate data within the expected timeframe.

The majority of pension providers and schemes connecting to dashboards will do so through a third party. It is important to consider the options carefully before deciding your route.

Help us shape the process

We are seeking industry feedback on voluntary connection to help inform the application process and its timeframe. To share your thoughts and interest in connecting voluntarily, please read the guidance and complete the feedback form.

If you are a connection provider, such as a third-party administrator, we encourage you to speak to your clients about voluntary connection. Their feedback, such as their appetite for connecting voluntarily and expected timings, will help inform the process and the point at which we open it up for applications. Please share any relevant feedback through your regular forums or working groups with PDP, or via our feedback form on the guidance page.

Find out more

If your scheme is considering applying to connect voluntarily, take a look at PDP's guidance on voluntary connection and TPR's guidance on connecting to pensions dashboards.