Key message despite the uncertainty in connection staging dates, schemes should continue to keep dashboard connection high on their agenda.
(1) Overview
The grand old Duke of York marched his troops up to the hill and then down again. The Government likewise got everyone poised for the statutory connection timetable with a connection deadline for certain schemes of 31 August 2023, only to announce: (1) on 2 March 2023 there would be a delay; and (2) on 8 June 2023 that the statutory timetable for schemes connecting is scrapped and instead there will be only one statutory connection deadline namely by 31 October 2026 and a staging timetable leading up to this will be set out in guidance.
This significant change in approach is reflected in the Pensions Dashboards Amendment Regulations laid in Parliament in June 2023. Subject to affirmative resolutions in Parliament (extremely likely) these Regulations will come into force in August 2023.
(2) Practicalities
Instead of a statutory connection timetable, the Government says the timing will be set “out in guidance which we will collaborate on with industry this year”.
What will the guidance say? TPR in its revised Guidance issued in June 2022 says the guidance “will indicate when schemes (by size and type) are scheduled to connect”.
What is the Staging Timeline? Unknown, but hopefully a modified timetable with some flexibility. At this stage the extent of the flexibility and what will constitute reasonable justification for departing from the guidance are unknown.
When will the guidance on staging deadlines be issued? Although the Government
Announcement on 8 June 2023 refers to the Government collaborating with industry on the guidance “this year”, it is unclear when the guidance will be finalised and issued. Much may depend on successfully overcoming the technical IT problems around connection which prompted the Government’s March 2023 announcement of a delay.
Who will issue the guidance? Schemes will have to have regard to guidance on connection issued by the Government, the Money and Pensions Service and the Pensions Regulator “either separately or by at least any two of them jointly” (Regulation 15(2)(d) of the Pensions Dashboards Amendment Regulations).
What should schemes do? TPR’s view is that schemes should work with their advisers “to assess the impact of the changes and plan how you will meet your dashboard duties”. Schemes should keep up momentum, particularly ensuring the quality of their data and that it is held digitally, as TPR’s Director of Regulatory Policy emphasised in her blog of 14 June 2023.
More generally, not being up to speed on data and data security can be very problematic as evidenced by the data breaches at outsourcing company Capita reported in March 2023; click here for the article in this Pensions Compass by Wedlake Bell’s Head of Data Protection, Alex Dittel, on cyber issues in the pension sector. Nor is cyber activity confined to the private sector: on 5 June 2023 the Pensions Ombudsman announced it was investigating a potential cyber breach and has taken certain of its services offline!