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Pension Schemes Act 2021

Contents

Part 4: Pensions Dashboards

Section 118 and 119: Pensions dashboards

  1. These sections amend the Pensions Act 2004 by inserting new sections in Part 4 (financial planning for retirement) of that Act. The inserted sections give the Secretary of State the power to make regulations to support the provision of pensions information to individuals who use certain pensions dashboard services or the pensions dashboard service provided by or on behalf of the Money and Pensions Service. Section 118(2) introduces new sections 238A to 238C.

Section 118: Qualifying pensions dashboard service

238A Qualifying pensions dashboard services
  1. Subsection (1) sets out the meaning of a pensions dashboard service. It is an electronic communications service by which pensions information may be requested by, and provided to, an individual using the service.
  2. Subsection (2) enables the Secretary of State to make regulations setting out that a pensions dashboard service must meet certain requirements if it is to be a qualifying pensions dashboard service. The duties imposed by new section 238D (information from occupational pension schemes) and new section 137FAA (information from personal and stakeholder pension schemes) of the Financial Service and Markets Act 2000 (as inserted by this act) apply where the pensions dashboard service meets the requirements for a qualifying pensions dashboard service. This is to ensure that the service meets certain conditions and standards before those responsible for a pension scheme are required to provide pensions information.
  3. Subsection (3) provides that those requirements may, in particular, relate to what relevant or other information must be provided to the individual using the dashboard service, how and in what circumstances it must be provided, as well as requirements relating to how the service is established, maintained and operated.
  4. Subsection (4) defines what is meant by "relevant information". This is information set out in the regulations relating to state pensions, basic or additional retirement pension, to occupational or personal pension schemes, or to a particular description of such schemes. This may include information relevant to an individual’s state pension, occupational or personal pensions.
  5. The regulation-making power in subsection (2) is further illustrated by subsection (5). The regulations may provide that the pensions dashboard service must comply with certain standards, specifications or technical requirements published by the Secretary of State, the Money and Pensions Service or a person specified or described in the regulations (subsection (5)(a)) or that the service provider must meet certain conditions (subsection (5)(b)). The regulations may further provide that a person operating a pensions dashboard service must be a person approved or authorised from time to time by a person or body described in this paragraph (subsection (5)(c)) or require the provider to provide or not to provide certain information, facilities or services in connection with the dashboard service (subsection (5)(d)).
  6. As set out in the Government’s consultation response, the provision of pensions dashboard services will involve multiple parties, technical services and governance. This is made up of the supporting digital architecture which allows dashboards to work, the dashboards themselves (with which consumers interact) and a governance system which monitors the whole infrastructure.
  7. Subsection (6) enables the regulations to allow for the making of determinations by Secretary of State, the Money and Pensions Service or a person specified or described in the regulations. This is to enable those identified in regulations to make decisions related to the establishment and running of pensions dashboard services and the related infrastructure.
238B Qualifying pension dashboard service: further provision
  1. This section supplements section 238A. In particular, subsection (1) provides that regulations under 238A(2) may impose requirements about how requests for information about pensions must be dealt with. This may include requirements about the format and presentation of data and the use of intermediaries to ensure the data is held in a compatible format for the purposes of matching and presentation. Section 238(1) further provides that the regulations may also impose requirements about the involvement of the dashboard service provider in arrangements for dealing with requests for pensions information.
  2. Subsection (2) provides that regulations subsection (1) may, in particular, impose requirements concerning the use of electronic communications, for example networks designed to support qualifying pensions dashboard services and the pensions dashboard service provided by the Money and Pensions Service (subsection (2)(a)). Subsection (2) also makes it clear that the regulations may impose requirements concerning the use of facilities or services (subsection (2)(b)) or the provision of assistance in connection with establishing, maintaining or managing those facilities or services (subsection (2(c)). The regulations may also provide that a qualifying pensions dashboard service must take part in arrangements for establishing, maintaining and managing such facilities and services as enable a pensions dashboard service to function (subsection (2)(d)).
  3. Subsection (3) clarifies that the facilities or services outlined in subsection (2)(b) above may include facilities or services designed for transmitting or authenticating information or for authenticating a person’s identity. This is so that the pensions information provided in relation to the scheme is accurate and can be securely transmitted using a trusted electronic communications network.
  4. Subsection (4)(a) goes on to provide that regulations under subsection (2)(b) may impose requirements as respects facilities or services which may include compliance with standards, specifications or technical requirements as are published from time to time by the Secretary of State, the Money and Pensions Service or a person specified or described in the regulations. Subsection (4)(b) allows regulations to require that facility or service providers in relation to a pension dashboard service are approved by the Secretary of State, the Money and Pensions Service or a person specified or described in the regulations.
  5. Subsection (5) makes it clear that regulations under subsection (2)(d) may, in particular, require the provider of the pensions dashboard service to co-operate, and to co-ordinate activities, with the Money and Pensions Service or a person specified or described in the regulations, and to enable them to monitor or audit compliance by the provider. This is to ensure that pensions dashboard services, which will be overseen or provided by the Money and Pensions Service, operate effectively and efficiently.
  6. Subsection (6) enables the regulations to provide that a disclosure of information provided for by the regulations is not to be a breach of a duty of confidence or a breach of any other restriction on the processing of personal data. This is subject to subsection (7) which makes it clear that this does not extend to authorising or requiring the processing of personal data which would otherwise contravene the data protection legislation, as defined in the next section.
238C Sections 238A and 238B: interpretation
  1. This section sets out a series of definitions used for sections 238A and 238B.
  2. Subsection (2) provides that "state pensions information" about an individual refers to the information set out in the section 42(7) of the Child Support, Pensions and Social Security Act 2000 or section 38(7) of the Child Support, Pensions and Social Security Act (Northern Ireland) 2000.
  3. Subsection (3) makes it clear that any reference made to the Money and Pensions Service also includes those persons (known as "delivery partners") to whom the Money and Pensions Service has delegate functions under section 5 of the Financial Guidance and Claims Act 2018.
  4. Subsection (4) defines what is meant by "additional retirement pension", "basic retirement pension", "the data protection legislation", "electronic communications service", "personal data" and "state pension".
  5. Section 118(3) amends section 316 of the Pensions Act 2004 and provides that any regulations that are made under the new section 238A, is subject to the affirmative resolution procedure.

Section 119: Information from occupational pension schemes

  1. Section 119 (1) and (2) introduce sections 238D to 238F into the Pensions Act 2004.
238D Information from occupational pension schemes
  1. Subsection (1) of the inserted section 238D enables the Secretary of State to make regulations imposing requirements on the trustees or managers of a relevant occupational pension scheme in relation to the provision, by a qualifying pensions dashboard service, of pensions information. "Relevant occupational pension scheme" is defined in section 238F. The regulations may also impose obligations on the scheme trustees or managers with respect to assisting a qualifying pensions dashboard service to provide this information. Subsection (1) also enables the regulations to impose similar requirements on the scheme trustees or managers with respect to the pensions dashboard service provided by the Money and Pensions Service.
  2. Subsection (2) enables the regulations to specify the meaning of "pensions information" in relation to a relevant occupational pension scheme. This information may, in particular, include information about an individual’s rights and obligations under the scheme, the pensions and other benefits to which they are or may be entitled and information designed to help the individual find out if they are a member of the scheme or to understand the scheme.
  3. Subsection (3) provides that regulations under subsection (1) may impose requirements relating to the provision of pensions information by the scheme trustees or managers. These include the persons to whom, and the manner, form and time in which, information must be provided and the steps to be taken before it is provided. For example, the regulations may provide that ID verification must be completed before any information is provided or that information must be in a certain electronic format.
  4. Subsection (4) provides that the regulations may require the scheme managers or trustees to comply with standards, specifications or technical requirements as are published from time to time by the Secretary of State, the Money and Pensions Service or a person specified or described in regulations, for example the Pensions Regulator.
  5. Subsection (5) enables the regulations under subsection (1) to allow for the making of determinations by the Secretary of State, the Money and Pensions Service or a person specified in the regulations. This is to enable those identified in regulations to make decisions related to the establishment and running of pensions dashboard services and the related infrastructure.
  6. Subsection (6) provides that regulations under subsection (1) may require the scheme trustees or managers to provide information about the carrying out by them of their requirements under this section to the Pensions Regulator, the Money and Pensions Service or a person specified or described in the regulations. This is, for example, to confirm the accuracy of data held and to support activity designed to help schemes provide data to dashboards and ongoing management information.
  7. Subsection (7) enables the regulations to provide that the scheme trustees or managers must have regard to any guidance issued by the Secretary of State or a person specified or described in the regulations in complying with their responsibilities under this section.
238E Information from occupational pension schemes: further provision
  1. Subsection (1) provides that regulations under 238D(1) may make provision about the way pensions information is provided, which may include the use of intermediaries, for example, parties providing elements of the infrastructure such as the pension finder service under contractual arrangement with the Money and Pension Service. Subsection (1) also enables regulations to set out the arrangements that the scheme trustees or managers must make to deal with requests for information about pensions.
  2. Subsection (2) makes it clear that regulations under subsection (1) may, in particular, impose requirements on the trustees or managers concerning the use of electronic communications networks, facilities or services. This is designed to support qualifying pensions dashboard services and the pensions dashboard service provided by the Money and Pensions Service. The scheme trustees or managers may also be required to provide assistance or to participate in arrangements for establishing, maintaining and managing such facilities and services as enable a pensions dashboard service to function.
  3. Subsection (3) clarifies that the facilities or services outlined in subsection (2)(b) may include facilities or services designed for transmitting or authenticating information and for verifying a person’s identity. This is so that the pensions information provided in relation to the scheme is accurate and can be securely transmitted using a trusted electronic communications network.
  4. Subsection (4)(a) goes on to provide that the regulations under subsection (2)(b) may require the trustees or managers to comply with requirements as regards the use of facilities or services which may include compliance with standards, specifications or technical requirements as are published from time to time by the Secretary of State, the Money and Pensions Service or a person specified or described in the regulations. Subsection (4)(b) makes provision for the regulations to require that a person who is providing a facility or service used in connection with a pensions dashboard service must be approved by the Secretary of State, the Money and Pensions Service or a person specified or described in the regulations.
  5. Subsection (5) provides that regulations under subsection (2)(d) may, in particular, require the trustees or managers to co-operate, and co-ordinate activities, with the Money and Pensions Service or a person specified or described in the regulations, for example to enable the collection of management information to enable audit activity such as the response times.
  6. Subsections (6) and (7) make the same provision as respects the exercise of the regulation –making powers in section 238D(1) and processing of personal data as is found in section 238B.
238F Sections 238D and 238E interpretation
  1. Subsection (1) applies for the purposes of sections 238D and 238E.
  2. Subsection (2) clarifies that any reference made to Money and Pensions Service also applies to those with whom the Money and Pensions Service have made arrangements to act as delivery partners. 
  3. Subsection (3) defines what is meant by "the data protection legislation", "pension dashboard service", "personal data", "qualifying pensions dashboard service" and "relevant occupational pension scheme".  
238G Compliance
  1. The new inserted subsection 238G(1) enables the Secretary of State to make provision in regulations for ensuring compliance with the duties imposed on the trustees or managers of a relevant occupational pension scheme in regulations made under section 238D. In section 238G, the Regulator refers to the Pensions Regulator (see Part 1 of the Pensions Act 2004).
  2. Subsection (2) provides that regulations may (amongst other things) make provision for the imposition of compliance notices, penalty notices, and for the making of appeals. They may also confer additional functions on the Regulator.
  3. Subsection (3) provides that regulations may determine the amount or maximum amount of penalty, which must not exceed £5000 in the case of an individual or £50,000 in any other case (subsection (4)).
  4. Subsection (5) explains that "a relevant occupational pension scheme" is as defined in 238F.
  5. Section 119(3) amends section 310 of the Pensions Act 2004 with the effect that any information given in relation to schemes is admissible in proceedings relating to financial penalties under new section 238G.
  6. Section 119(4) amends section 316 of the Pensions Act 2004 with the effect that any regulations that are made under sections 238D or 238G of that Act are subject to the affirmative resolution procedure.
  7. Section 119(5) amends Schedule 1 of the Pensions Act 2004 to enable regulations to permit the Regulator to authorise other persons to exercise the functions in new section 238G on its behalf.

Section 120: Pensions Dashboards: Northern Ireland

  1. This section introduces Schedule 9 which contains provision for Northern Ireland corresponding to provision made for England, Wales and Scotland set out in sections 118 and 119.

Schedule 9: Pensions dashboards: Northern Ireland

  1. This Schedule makes provision for Northern Ireland similar to that made by Part 4, sections 118 and 119.
  2. Paragraph 2 (qualifying pensions dashboard service) corresponds to section 118.
  3. Paragraph 3 (information from occupational pension schemes) corresponds to section 119.
  4. These paragraphs amend the Pensions (Northern Ireland) Order 2005 by inserting new Articles after Article 215 of the Pensions (Northern Ireland) Order 2005. They allow the Department for Communities in Northern Ireland to make regulations which are designed to support the provision of pensions information to individuals who use certain pensions dashboard services or a pensions dashboard service provided by or on behalf of the Money and Pensions Service. This includes setting out the requirements for providing such services.
  5. Paragraph 4 (Admissibility of statements) corresponds to section 119(3).
  6. Paragraph 5 (Assembly control of regulations) corresponds to section 119(4). This paragraph amends Article 288 of the Pensions (Northern Ireland) Order 2005 and provides that any regulations that are made in respect of the new Articles 215A, 215D and 215G are subject to the confirmatory procedure.

Section 121: Information from personal and stakeholder pension schemes

  1. This section amends the Financial Services and Markets Act 2000 ("FSMA") by inserting three new sections, section 137FAA, 137FAB & 137FAC, into that Act. These new sections set out the requirement that, subject to certain exceptions, the Financial Conduct Authority must exercise its general rule making powers to make rules in relation to personal pension schemes and certain stakeholder pension schemes with respect to the provision of pensions dashboard services.
137FAA Financial Conduct Authority general rules: pensions dashboards
  1. Subject to certain exceptions (which are provided for in section 137FAB), section 137FAA(1) requires the Financial Conduct Authority to exercise its general rule making powers in section 137A of FSMA to impose requirements on certain persons with respect to the provision, by a qualifying pensions dashboard service or any dashboard service provided by the Money and Pensions Service, of pensions information. The rules must (subject to exceptions) also impose requirements on such persons with respect to assisting a qualifying pensions dashboard service or the pensions dashboard service provided by the Money and Pensions Service to provide this information.
  2. The requirements apply to persons authorised by the Authority and specified in the rules (see section 137FAC for the meaning of "specified authorised persons"). The intention is that the rules will apply to the person who is authorised under Part 4A of FSMA to operate a personal pension scheme or a stakeholder pension scheme.
  3. Subsection (2) enables rules to specify the meaning of "pensions information" in relation to a personal pension or a stakeholder pension scheme. This information may, in particular, include information about an individual’s rights and obligations under the scheme, the pensions and other benefits to which they are or may be entitled and information designed to help the individual find out if they are a member of the scheme or to understand the scheme.
  4. Subsection (3) provides that rules may impose requirements relating to the provision of pensions information to the individual, by authorised persons. These include the persons to whom, and the manner and form in which, information must be provided and the steps to be taken before it is provided. For example, the rules may provide that ID verification must be completed before any information is provided or that information must be in a certain electronic format.
  5. Subsection (4) provides that the rules may require specified authorised persons to comply with standards, specifications or technical requirements as are published by the Secretary of State, the Money and Pensions Service or a person specified or described in rules.
  6. Subsection (5) enables the rules to allow for the making of determinations by the Secretary of State, the Money and Pensions Service or a person specified or described in rules.
  7. Subsection (6) provides that rules may require specified authorised persons to provide information about the carrying out by them of their requirements under this section to the Financial Conduct Authority, the Money and Pensions Service or a person specified or described in the rules. This is for example, to confirm the accuracy of data held and to support activity to help schemes provide data to dashboards and ongoing management information.
  8. Subsection (7) enables rules to provide that specified authorised persons must have regard to any guidance issued from time to time by persons specified or described in the rules in complying with their responsibilities under this section.
  9. Subsection (8) specifies that the Financial Conduct Authority must have regard to any regulations made under 238D of the Pensions Act 2004 or any corresponding provision in force in Northern Ireland in determining what should be included within the rules.
137FAB Pensions dashboards: further provision
  1. This section makes further provision in relation to the rules under section 137FAA(1). Subsection (1) provides that rules may, in particular, impose requirements on specified authorised persons to provide pensions information in a particular way and concerning the arrangements for dealing with requests for this information. This may include the format and the use of intermediaries, for example, parties providing elements of the infrastructure including under contractual arrangements with the Money and Pension Service.
  2. Subsection (2) provides that rules may, in particular, impose requirements on specified authorised persons concerning the use of electronic communications networks, facilities or services. This is designed to support qualifying pensions dashboard services and the pensions dashboard service provided by the Money and Pensions Service. The authorised person may also be required to provide assistance or to participate in arrangements for establishing, maintaining and managing such facilities and services as enable a pensions dashboard service to function.
  3. Subsection (3) further clarifies that the services and facilities outlined in subsection (2)(b) above may include facilities or services designed for transmitting or authenticating information and for verifying a person’s identity. This is so that the pensions information provided in relation to the scheme is accurate and can be securely transmitted using a trusted electronic communications network.
  4. Subsection (4)(a) makes it clear that that rules under subsection (2)(b) may impose requirements as regards facilities or services which may include compliance with standards, specifications or technical requirements published from time to time by the Secretary of State, the Money and Pensions Service or a person specified or described in the rules. Subsection (4)(b) provides that the rules may require that a facility or service provider in relation to a pension dashboard service is approved by the Secretary of State, the Money and Pensions Service or a person specified or described in the rules.
  5. Subsection (5) makes it clear that rules under subsection (2)(d) may require authorised persons to co-operate, and to co-ordinate activities, with the Money and Pensions Service or a person specified or described in the rules. This is to ensure that pensions dashboard services, which will be overseen or provided by the Money and Pensions Service, operate effectively and efficiently.
  6. Subsections (6) and (7) make the similar provision as respects the processing of personal data to that in section 238D(1) of the Pensions Act 2004.
137FAC Sections 137FAA and 137FAB: supplementary
  1. Subsection (1) provides that the Financial Conduct Authority must consult the Secretary of State and HM Treasury before publishing a draft of the rules.
  2. Subsection (2) provides that section 137AA is not to be treated requiring the Financial Conduct Authority to make general rules by virtue of that section which come into force before regulations under section 238D of the Pensions Act 2004 are in force.
  3. Whilst section 137FAA imposes a duty on the Financial Conduct Authority to make rules, subsection (3) makes it clear that this is not to be taken as requiring the Authority to make rules in every case to which the power extends. This is so that provision may be made for exceptions, for example where a personal pension scheme has very few members, or to allow for a phased introduction so that the requirements apply to some schemes before others.
  4. Subsection (4) clarifies that any reference made to the Money and Pensions Service also applies to those with whom the Money and Pensions Service have made arrangements to act as delivery partners.
  5. Subsection (5) provides for definitions relevant to newly inserted sections 137FAA and 137FAB, including definitions of "pensions dashboard service", "personal pension scheme", "qualifying pensions dashboard service", "specified authorised person" and "stakeholder pension scheme".
  6. Section 121(3) makes an amendment to section 138F of FSMA whereby the Financial Conduct Authority will not be required to notify the Bank of England about rules made under section 137FAA in regards to pensions dashboards.

Section 122: The Money and Pensions Service: the pensions guidance function

  1. Section 122 inserts a new section 4A after section 4 in the Financial Guidance and Claims Act 2018.
  2. The pensions guidance function of the Single Financial Guidance Body, otherwise known as the Money and Pensions Service, is to provide to members of the public free and impartial information and guidance relating to occupational and personal pensions (see section 3 of that Act).
  3. Subsection (1) of new section 4A makes it clear that the Money and Pension Service must provide a pension dashboard service dealing with information which occupational and personal pension schemes are required to provide. Subsection (2) enables the Money and Pensions Service to also provide state pensions information as part of their dashboard service, including information relating to an individual, and information about basic and additional retirement pension.
  4. Subsection (3) makes it clear that the Money and Pensions service can carry out other functions in relation to pensions dashboard services for which provision is made in regulations or FCA rules as the result of the new sections introduced in this Part of the Act. Subsection (4) provides that, in particular, the functions referred to in subsections (1) to (3) are part of the pension guidance function. But, as subsection (4) overlaps with things that the Money and Pensions Service can do already in pursuance of its pensions guidance function, subsection (5) is included to make sure that the breadth of its existing functions is maintained.
  5. Subsection (6) concerns definitions relevant to section 4A.

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