There is a contradiction at the heart of the DWP’s proposals for the delivery of the pension dashboard.
The DWP place great emphasis on the importance of open standards, competition and innovation, yet many of the key decisions lean towards centralised infrastructure, a single supplier and centralised funding.
The imposition of centralised infrastructure (the single Pension Finder Service and, at least initially, a single dashboard) precludes the possibility of an open competitive market in technology. It will necessitate the central procurement of the majority of dashboard technology and in turn a much more significant role for the government and/or regulator in the dashboard delivery. We believe this would result in higher costs for the consumer and constrain innovation.
We would like to see the creation of an open, competitive market in dashboard technology, a model that has already proven effective in many financial services technology markets including Open Banking and TISA Exchange open transfers. A competitive market for technology encourages innovation, speed to market and cost reduction. No technology supplier would have a monopoly and new innovative suppliers could emerge to disrupt the market at a later stage.
We all hope that the pension dashboard will become the springboard for the launch of broader services where consumers can get a single view of all their retirement funding (not just pensions) or perhaps broader still across their entire financial status covering debts, insurance, investments and savings. But the proposed centralised approach will preclude this possibility and stifle the emergence of new innovative players.
To their great credit the DWP were clear-sighted enough to recommend an open and competitive architecture for the now abandoned Pot-Follows-Member solution. We encourage them to think again on the pension dashboard and create an open and competitive framework where innovation can thrive and consumers have more choice.