23 June 2025
The Department for Work and Pensions (DWP) has released a roadmap for workplace pensions and is intended to be read alongside the Pensions Investment Review.
While the majority of the report focuses on the financial aspects of pension funds, which many payroll professionals will have little to no involvement with, there are some interesting comments to note, particularly around default consolidation.
The government still intends to move forward with small pots consolidation as well as default consolidator frameworks for larger funds. The report states:
“The implementation of the Small Pots Consolidation solution is purposefully designed to fully come into force once the market of a smaller number of Megafunds is in place, with the implementation of the Multiple Default Consolidator simplified by the move to a smaller number of schemes. Policy and delivery work will be finalised over the coming years, but the timing of requiring the movement of small pots is such as to allow a ‘cooling off period’ before the duties on schemes are ‘switched on’ to avoid schemes being required to move deferred small pots earlier than having to move other pots should they be on track to consolidate or merge with another scheme.”
The government also continues to consider a government consolidator for Defined Benefit schemes, which could possibly be run by the Pension Protection Fund (PPF).
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