Small DB schemes urged to act over pensions dashboards costs
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A consultancy has suggested that trustees of well funded defined benefit schemes should think about transferring to an insurer now instead of paying for pensions dashboards compliance ahead of their endgame, and warned the window to act is closing.
Consulting firm Cartwright has said trustees risk sinking money into pensions dashboards compliance unnecessarily where this will only be needed for a limited time, urging them to instead consider consolidating their schemes.
The first pension schemes are expected to connect to the pensions dashboard architecture from April this year, with a hard deadline for all schemes in scope in 31 October 2026.
Cartwright said smaller schemes are most affected by the costs of connecting to the dashboards, estimating initial set-up fees for small and medium schemes to be £30,000 to £100,000, as well as maintenance fees based on membership numbers.
“For many schemes, the costs associated with the Pensions Dashboard risk becoming ‘dead money’. Trustees need to question whether these expenses truly serve their members’ best interests, particularly for schemes nearing their endgame, where compliance is only required for a limited period,” said Julie Yates, director of administration.
Consulting firm Cartwright has said trustees risk sinking money into pensions dashboards compliance unnecessarily where this will only be needed for a limited time, urging them to instead consider consolidating their schemes.
The first pension schemes are expected to connect to the pensions dashboard architecture from April this year, with a hard deadline for all schemes in scope in 31 October 2026.
Cartwright said smaller schemes are most affected by the costs of connecting to the dashboards, estimating initial set-up fees for small and medium schemes to be £30,000 to £100,000, as well as maintenance fees based on membership numbers.
“For many schemes, the costs associated with the Pensions Dashboard risk becoming ‘dead money’. Trustees need to question whether these expenses truly serve their members’ best interests, particularly for schemes nearing their endgame, where compliance is only required for a limited period,” said Julie Yates, director of administration.
She said schemes should therefore consider whether transferring or consolidating might deliver better value and outcomes.
“For well-funded smaller schemes, completing a buy-in and winding up within two years is entirely achievable, bypassing unnecessary dashboard costs while fully protecting members’ benefits,” she added, but warned that “the window to act is closing".
“For well-funded smaller schemes, completing a buy-in and winding up within two years is entirely achievable, bypassing unnecessary dashboard costs while fully protecting members’ benefits,” she added, but warned that “the window to act is closing".
