With more pensions-related legislation predicted next year, a new report from the Society of Pension Professionals (SPP) has highlighted six priorities for policymakers, regulators and the pensions industry to consider.
In a report published today (22 October), the SPP set out a vision for UK pensions to deliver a simpler and fairer system with better retirement outcomes at the centre of changes.
The report – titled ‘What’s Next for UK Pensions?’ – called for policymakers to build on the success of automatic enrolment and create a pension system fit for the next generation.
Shayala McRae, chair of the SPP’s working group for the report, said: “Automatic enrolment has transformed workplace pension saving but we need to build on that achievement, helping people to not just save, but to save enough, to make informed decisions and turn their savings into a secure income throughout retirement.
“Our report offers a constructive, long-term vision for the future of UK pensions, with practical recommendations that government, regulators, employers and the industry can work together to deliver. With the next phase of pension reform approaching, there is a real opportunity to build a system that serves savers and future generations even better.”
The SPP pointed to expectations of a further Pensions Bill in 2027. While there is no official confirmation of new legislation, Pensions Expert reported last year that the Pensions Regulator had been lobbying government for powers to regulate administrators and professional trustee companies.
In addition, the Pensions Commission is set to publish its final report early next year, with a response from government promised by the summer – meaning any legislative action needed could be initiated before the end of 2027.
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The SPP report’s recommendations included establishing a clear framework for retirement income through policies such as guided retirement, helping people turn pension savings into lasting income.
Other recommendations included improving pension adequacy, delivering better value through consolidation, and empowering savers through better guidance and technology.
Alongside calls for automatic enrolment to be extended to workers aged 18 and over and pension contributions to be calculated from the first pound of earnings, the SPP suggested that the government should establish a formal definition of pension adequacy combining minimum income, replacement rates and Pensions UK’s Retirement Living Standards.
The trade body also urged the government to announce a clear long-term timetable for increasing minimum workplace contributions towards 12% of eligible earnings, shared equally between employers and employees.
The report also advocated better support for people as they move into retirement and wider development of collective defined contribution pension arrangements. It also called for the government to review the Pension Protection Fund’s purpose, with the defined benefit lifeboat fund now holding a reserve fund of around £14bn.
