Some comment from across the sector on the Reeves’ Mansion House speech, proposing a roll up of DB pension funds, to free up more cash for infrastructure projects;
Lily Megson, Policy Director at My Pension Expert, said, “The Chancellor’s ambition to create ‘pension mega funds’ to fuel UK growth is well-intentioned, but savers need transparency and involvement in decisions that impact their retirement funds. Committing to the “biggest pension reforms in decades” is not a positive boast if consumers – those people whose hard-earned pension savings is at stake – are not properly informed and engaged with, helping them understand both the potential returns and risks.
“Using pension funds to simultaneously boost investment into UK industries, trigger economic growth and improve the performance of those funds is, of course, all positive. But it cannot come at the expense of financial security for retirement planners. What’s more, truly meaningful, radical pension reform must address a much broader range of issues that blight the country’s pensions market – such as limited pension engagement, the gender gap, lack of financial literacy, and limited access to guidance and advice.
“To properly support UK savers, we need a balanced approach – one that doesn’t sacrifice long-term financial security in the pursuit of UK economic goals. Savers need confidence that their retirement is the priority, not just a means to balance the books.”
Nausicaa Delfas, Chief Executive of The Pensions Regulator, said:
“We welcome the bold reforms announced by the Chancellor which will accelerate the move towards a consolidated market of fewer, larger pension schemes better equipped to deliver for savers and invest in the UK economy.
“Backed by new powers, we can make sure larger schemes deliver real value for money for pension savers and raise standards across the market, while also encouraging innovation in new models.”
Jesse Griffiths, CEO of The Finance Lab said on X;
The Chancellor’s plan for pension ‘megafunds’ is a welcome step in the ‘biggest pension reforms in decades’. However, far more ambition is needed in the next stage if we are to truly fix our broken pension system. Consolidation has been a focus over many years. It should improve efficiency and allow funds to invest in a wider range of assets and adopt a longer-term investment perspective. The £80bn of extra UK investment the Chancellor is targeting is at the top end of possible impact.
The government is also consulting on Collective DC pension schemes, which help reduce the risks for individuals & invest longer-term. These could boost expected pensions by 50% – welcome given most are not saving enough for a basic retirement income.”
Ex Chancellor Jeremy Hunt MP on X;
“Much to welcome in the Chancellor’s Mansion House speech today. Broadly same strategy and approach as I announced in the Mansion House Reforms last year and vitally important for the UK tech, life sciences and infrastructure sectors. One thing is missing; that is to set up portable pension pots that automatically follow you from job to job as the default. It has been spectacularly successful in boosting savings and retail investment in Australia but will take political will to push it through here.
It’s a reform that would simplify the system, boost savings rates in the economy & turn us all into an army of retail investors – with no cost. Now is the start of a parliament with a pensions bill coming e.g. a once in a lifetime moment so the government should seize it!”
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