13 July 2026
The Department for Work and Pension (DWP) has today published a timetable for implementing what it describes as the biggest pension reforms in a generation, aimed at improving pension outcomes for millions of workplace pension savers.
A key part of the changes is a new Value for Money framework, which will require pension schemes to demonstrate publicly how well they perform compared to others in the market.
Schemes will be assessed on investment returns, costs and charges, and quality of service, making it easier for savers to see whether they are getting a good deal. Poorly performing schemes will be expected to improve or could ultimately face closure if they fail to do so.
Larger pension schemes, including Master Trusts, large single employer schemes, and multi-employer contract-based schemes open to new employers, will complete and publish these Value for Money assessments from 2028. The framework will then be extended to all workplace pensions from 2029.
The Government has also released a discussion paper on its flagship scale policy to build a market of fewer, larger and better pensions schemes. The proposals include from April 2030 all automatic enrolment schemes in scope must reach at least £25 billion in assets under management or have at least £10 billion with a credible growth plan to reach £25 billion by 2035.
In addition, default pensions will also be introduced so that savers reaching retirement can convert their pension savings into sustainable retirement income, while preserving individuals’ freedom to choose alternative options. It is similar to how workers are automatically enrolled into a workplace pension while they are working. The Government now wants a default pathway at retirement so that people who do nothing are still guided into a sensible retirement income solution rather than having to make potentially complicated decisions unaided. The Government estimates that the wider reforms could increase the average pension pot by around £29,000 by retirement.
The biggest implications for pay professionals are likely to be:
- more employee queries about scheme quality and value
- possible future pension provider changes resulting from the market consolidation or Value for Money framework
- staying informed as further details emerges between now and 2030.
As always, the Policy Team will be keeping an eye on this and will provide further information when we can.
The discussion paper is open for feedback until 7 September 2026.
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