Denying delegated access to the pension dashboard to advisers and other authorised third parties in the first wave of rollout is ill advised and short-sighted says Cavendish Ware associate director Roy Mcloughlin
When you have been advising on pensions for 30 years you learn some very obvious lessons. Top of that list is that the person on the proverbial Clapham Omnibus simply does not have anything approaching our enthusiasm for the subject. For years a combination of boredom, inertia and misplaced faith that the state will provide has left pensions a subject that can clear rooms in seconds.
But hang on… something has changed and now not only are those rooms full but we have an attentive audience who are invariably armed with questions. As someone who has spent a huge amount of time talking to groups of workers over the last 3 years, it is clear auto-enrolment is driving increases in the number of people interested – but what is changing their attitudes?
Firstly there is clearly a realisation that there is no conspiracy here and that it’s all about demographics and not about politics. The young understand this demographic imperative in a way that their older peers never did. But they do ask advice from parents too, and the feedback is generally ‘mum and dad told me this is a no brainer but can you assure me a “Maxwell’ won’t happen?’
Older people, once AE is explained, not only recognise that some of the traditional prejudices have been changed – if I had a pound for each time I’ve been told pensions cannot move when you leave a job – but also that the state pension is not enough to live a reasonably comfortable life. Furthermore they appreciate once explained the potential advantages of pension freedoms and the much fairer system on death.
But against this positive backdrop I am asked on a daily basis about previous pensions. When I mention plans for a pensions dashboard and the ability to look at all schemes, including state, on a single screen, the eyes generally light up.
Why is this so important? People want to know what they have. Many wish to combine pots but all want some guide as to what they will actually receive at retirement. If, when they realise what they have got is not enough then an explanation of compounding will help them understand there are things they can do about it.
Not all the people I see in group presentations will seek advice, but many do and I suspect even more will in the future. As technologically-advanced as some sections of society are, the need and desire for advice does not disappear if someone has improved online access. On the contrary I know from experience that online access to information often leads to advice and consultation. So I believe I speak for many advisers when I say that the idea of not allowing them to see their clients’ dashboards in this first wave of dashboard rollout beggars belief.
It could be argued that the adviser can always get the client to log on when they are with them. But advisers are meant to turn up to client meetings prepared and to do analysis before and after the face-to-face meeting.
I call upon the ABI to re-consider the announcement last week that delegated access to advisers and others will not be allowed in the first wave of the pension dashboard, and urge them to strongly recognise the importance and potential increased desire that clients will have for advice once this excellent concept is ready. We are arguably in the most positive and receptive position there has ever been for pensions and the industry must be a joined up force.
What do I base this request on? My conversations with real life clients who find it inconceivable and illogical that the one person they want to sit down with cannot see this information. You wouldn’t have thought you could make this up – unless you’ve worked in this industry and know it well.