PASA AVC Toolkit – Connecting split administration
Under the pensions dashboard regulations and FCA rules, the duties apply to all benefits from the date a scheme first connects to the pensions dashboard Central Digital Architecture (CDA). Where a scheme only has one administrator, achieving compliance should be straightforward.
Where a scheme has more than one administrator, including AVCs being connected to the CDA directly by the AVC provider, then achieving compliance will require all providers to connect on the same date. If this doesn’t happen, it will result in a breach of the regulations or rules. It’s recognised there may be instances where this isn’t achievable and, despite the best efforts of all parties, a breach occurs.
PASA liaised with TPR and FCA to understand their perspective should this situation arise. Their response is repeated below:
In terms of multiple sections of a scheme connecting on the same date, the following outlines the regulators’ position:
- The regulators expect all parts of the scheme to connect at the same time. This includes schemes that have multiple sections or members with additional voluntary contributions (AVCs)
- Where a scheme or provider is unable to connect all sections at the same time, it is expected that efforts are made to connect any remaining sections at the earliest opportunity
- Both regulators will take a pragmatic approach taking into account the potential impact on members
- Occupational schemes should follow TPR’s breach of law guidance to consider whether they need to report such a breach to them with relevant remedial activities. TPR will not normally consider this breach to be materially significant if prompt and effective action is taken to connect the rest of the sections by the connection deadline, 31 October 2026. This guidance has dashboard specific examples to assist trustees and others with a reporting duty to decide whether to report a breach to us
- FCA-regulated providers may wish to consider utilising the FCA’s modification by consent in such cases. [Modification by consent: COBS TP 2.38BR | FCA|https://www.fca.org.uk/firms/modification-consent-cobs-tp-238br]
Although it’s only likely to be a short-term issue, there’s a specific scenario to consider. This is where due to PDP scheduling, not all ISPs which are associated with one scheme are connected to the ecosystem at the staging date in guidance. For example, the Integrated Service Provider (ISP) of an AVC provider where the Multiple Source approach is being used is connected at that date, or the ISP of a different administrator who looks after a DC section is not yet connected. This means trustees with multiple/split administration may be unable to connect all parts of their scheme at the same time. To help trustees and scheme managers decide whether to connect the parts/sections of their scheme on a phased basis as ISPs achieve connection, TPR has provided the following:
- TPR expects schemes to connect in line with the connect by dates set out on DWP’s guidance. staged timetable prioritises the largest pension schemes and providers, so crucial user testing can take place quickly at scale to enable the launch of dashboards to the public as soon as possible. Following the dates within the staged timetable will also help to mitigate against undue strain on all parties involved in facilitating connection, including PDP, administrators, and Integrated Service Providers
- We have been clear in our Lines To Take that while our expectations are that schemes connect all parts at the same time (so that savers are able to see all of their benefits together), we do understand that this is challenging for those schemes connecting over the coming months, where due to PDP scheduling, not all ISPs are connected to the ecosystem, which means that trustees with multiple/split administration may be unable to connect all parts of their scheme at the same time
- TPR have confirmed that at this current time, there will be no regulatory intervention for pension providers and schemes who are unable to meet their connect by dates in guidance solely due to their dependence on a volunteer participant who has yet to connect
- Where a scheme or provider is unable to connect all sections at the same time, it is expected that efforts are made to connect any remaining sections at the earliest opportunity. Both TPR and FCA have stated that they will take a pragmatic approach, taking into account the potential impact on members.
- TPR have also confirmed their expectation that schemes connect as soon as possible, and that they consider our breach of law guidance (which has specific dashboards examples), and that TPR will not normally consider this breach to be materially significant if prompt and effective action is taken to connect the rest of the sections by the connection deadline, 31 October 2026. The breach of law guidance has dashboard specific examples to assist trustees and others with a reporting duty to decide whether to report a breach to us.
For schemes or arrangements with multiple administrators our suggested approach would be for trustees and scheme managers to:
- Obtain details of the date each provider has connected/is proposing to connect to the CDA
- Having reviewed the dates, select one date, advise the administrators of the selected date and ascertain if they will be connected to the CDA on that date. Depending on the connection status the suggested next steps are as follow:
- If all administrators will be connected on the chosen date:
- ensure each administrator has a registration code to connect to the CDA. Further information on when additional registration codes are needed and how these can be obtained can be found here:
- Check with each administrator immediately before and after the selected date to ensure connection has taken place as planned
- In the event not all benefits have been connected on the same date, trustees will need follow the TPR/FCA guidance set out above
- If NOT all administrators will be connected on the chosen date
- Confirm whether or not connection should go ahead for those parts of the scheme where the ISP is connected to the CDA and have a plan in place to connect the remaining relevant members as soon as possible
- As parts of the scheme connect to the CDA or on the revised connection date if the decision is taken to delay until all ISPs are ready, follow steps 1 to 3 above
If the connection for a scheme takes place on a phased basis, this should be noted in the breaches log and assessed in line with TPR guidance above.
Trustees may wish to delegate some or all of these activities to one of their administrators, or to their ISP. Even where some of these activities are delegated, the requirement to connect all benefits on the same date or take appropriate action where this isn’t possible remains a trustee duty.
