The Department for Work and Pensions (DWP) has opened a consultation on strengthening trustee capability, governance structures and administration standards in trust-based workplace pension schemes.
Published on 15 December, the consultation runs until 5 March 2026 and asks whether existing arrangements remain fit for purpose as the pensions market shifts towards fewer, larger schemes and trustees take on new responsibilities under the Pension Schemes Bill currently before parliament.
It also proposes a higher bar for professional trustees, including statutory accreditation, as well as the development of a trustee directory – something the Pensions Regulator has been investigating for some time.
The proposals span trustee skills and knowledge, board diversity, member voice and the consistency of administration standards. The DWP is also examining governance risks associated with consolidation, including conflicts of interest and the concentration of decision-making in more streamlined trustee models.
Introducing the consultation, pensions minister Torsten Bell said good governance remained central to delivering strong outcomes for savers as the system transitions from defined benefit (DB) to defined contribution (DC).
“The pensions landscape is changing,” Bell wrote. “The transition from DB to DC is well underway. The DC market itself is transitioning to a more mature structure, characterised by bigger schemes. Change is also being accelerated by the Pension Schemes Bill…
“Amid this change, one thing remains constant: the importance of good governance, with schemes overseen by trustees that have not only the skills and knowledge to navigate the changes to come, but also members’ best interests consistently front of mind.”
The consultation follows a period of collaboration between the DWP and the Pensions Regulator on governance standards. Pensions Expert reported in August that the two bodies were working on a potential ‘Pensions Reform Bill’ to cover trusteeship, governance, and administration issues.
Caution and proportionality urged
Industry bodies broadly welcomed the consultation, while emphasising the importance of proportionality as governance expectations evolve.
“We advise careful consideration of applying any restrictions to appointment numbers or terms, given the need to manage market capacity and encourage the continuation of training and development for professional trustees.”
Rachel Croft, Association of Professional Pension Trustees
Tiffany Tsang, head of DB, LGPS and investment at Pensions UK, said: “Trustees across all scheme types need the right environment and conditions to do their jobs effectively. Ensuring they have the appropriate skills and capability will be central to success, alongside a proportionate approach that reduces unnecessary burdens and allows trustees to focus on their core fiduciary responsibilities.”
Rachel Croft, chair of the Association of Professional Pension Trustees, said: “We welcome the trustee directory, subject to it not being excessively onerous administratively.”
She added: “We advise careful consideration of applying any restrictions to appointment numbers or terms, given the need to manage market capacity and encourage the continuation of training and development for professional trustees.”
Alongside governance, the consultation explores whether higher, centrally set standards should apply to professional trustees, including statutory accreditation, while avoiding measures that could discourage lay trustees from participating. It also asks what additional support lay trustees may need to operate effectively in a more complex and data-driven environment.
“As complexity grows, standards need to rise to safeguard members and ensure confidence in the system.”
Helen Forrest Hall, Pensions Management Institute
The DWP is also seeking views on whether minimum standards or stronger regulatory oversight should apply to pension administrators, citing the growing importance of administration as initiatives such as pensions dashboards and value-for-money assessments increase expectations around data quality and member service.
The Pensions Management Institute (PMI) said the consultation reflected the scale of change facing the system.
Helen Forrest Hall, chief strategy officer at the PMI, said: “The pensions industry is undergoing profound change and those at the forefront, trustees and administrators, must be equipped with the skills and expertise to deliver for savers. As complexity grows, standards need to rise to safeguard members and ensure confidence in the system. This consultation marks an important step in shaping that future.”
AMNT: Members’ voices ‘essential’ in all schemes
The Association of Member Nominated Trustees was supportive of the consultation, pointing out that it featured many issues that it had been campaigning on for several years.
“There is a clear risk that the loss of this voice could increase conflicts of interest and encourage groupthink among a limited pool of professional trustees.”
Association of Member Nominated Trustees
In a statement, the association said: “The minister’s foreword states that ‘trusteeship is a vocation’, and this is particularly evident in the role of member-nominated and other lay trustees, who engage in trusteeship because of their direct connection to the scheme and its beneficiaries.
“For the sake of members, it is essential to find ways to preserve that voice within larger multi-employer and master trust schemes, whether DB, DC, or collective DC. The most effective way for that voice to be heard is through representation on the governance board, supported by appropriate training and experience tailored to the scheme.
“There is a clear risk that the loss of this voice could increase conflicts of interest and encourage groupthink among a limited pool of professional trustees. The most effective boards bring together individuals with diverse backgrounds and experience, enabling constructive challenge and collaboration in the best interests of members.”
