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For a long time, the workplace pensions market has tended to place providers into neat categories. There were the traditional insurers, the consultant adviser-led master trusts, the AE providers, and the challenger brands. As workplace pensions have evolved, those distinctions have become less meaningful.
One of the biggest misconceptions in the market is that providers with auto-enrolment roots offer a more basic proposition. Increasingly, the opposite is true. The providers that helped bring millions of people into pension saving are now among those best positioned to deliver high-quality pension outcomes at scale, because of the breadth of their membership and employer clients.
Auto-enrolment was phase one
Auto-enrolment was an important first phase for the pensions industry. It brought millions more people into long-term saving and fundamentally reshaped participation in workplace pensions.
The market has matured significantly since then. Workplace pensions are no longer judged primarily on compliance and administration. Employers and advisers are increasingly focused on member outcomes, engagement, investment capability, retirement support, and long-term resilience. Many schemes selected during the early years of auto-enrolment are now being reassessed against a very different set of expectations. That shift is changing what good looks like in the workplace pension market and, in turn, why scale matters.
Scale only matters if it improves outcomes
The industry has spent years talking about scale as a headline number. The more important question is what providers do with that scale.
Historically, scale has often been viewed primarily through the lens of administration costs, membership numbers, or market share. In reality, its value lies in what it enables providers to deliver for members and employers compared to what is generally out of reach for smaller schemes.
Around one in five UK workers now save with us. That breadth provides us with a deep understanding of how different groups of savers behave, engage and prepare for retirement across every part of the workforce.
More importantly scale is enabling a more advanced pension proposition rather than limiting it. Today, we support employers ranging from one-person start-ups to organisations with tens of thousands of employees. In recent years, we have seen growth not only in membership, but also in average contribution levels, scheme sizes and the complexity of employers joining the scheme.
Scale creates opportunities to invest more heavily in governance, investment capability, technology and member support, while continuing to make high-quality pension provision accessible across diverse workforces. It enables providers to invest more significantly in operational infrastructure and automation. At People’s Pension, integrated payroll connectivity and API-driven processes are increasingly replacing manual administration, helping reduce friction, improve accuracy, and strengthen the day-to-day experience for employers of every size, not just the largest schemes.
Scale also matters operationally as consolidation accelerates, and more employers review legacy arrangements or consider complex scheme transitions. Advisers need confidence that providers can manage those transitions efficiently, minimise disruption and support employers through periods of change, while ensuring all members continue to benefit from the same evolving master trust proposition rather than being left behind in fragmented legacy arrangements.
Sophistication should not be reserved for large schemes
Take investments. Scale enables the creation of a fully agile internal manager that can provide access to institutional-quality investment opportunities across sophisticated asset classes to every member. It supports greater control over stewardship, governance and manager selection through approaches such as segregated mandates, internalised fund selection, and direct capabilities in specialist asset classes. It also creates the capacity to embed innovation directly into the default strategy itself.
We adopt a single default to ensure clarity and clear accountability. Rather than fragmenting members across multiple defaults over time, this approach enables innovation, governance oversight and investment improvements to be delivered consistently to our seven million members. It also helps reduce the risk of members being left behind in legacy arrangements that no longer reflect best practice.
Higher-quality pension provision should not be limited to larger employers or higher earners. Our focus has been on ensuring all members benefit from the same core pension proposition, investment strategy and support regardless of employer size, sector or workforce profile. As workforces become more diverse, accessibility and inclusivity will become increasingly important features of good pension design. That is not simply about digital access. It is about creating experiences that feel more relevant, personalised and emotionally connected to members’ lives.
Making pensions easier, not more complicated
Today’s workforce is more mobile, fragmented and diverse than ever before. Employers are navigating multi-generational workforces, longer working lives, rising financial anxiety and growing expectations around financial wellbeing. The challenge for providers is not simply to launch more products or more tools. It’s to make pensions easier to understand, easier to engage with and easier to navigate.
Most people do not want to become pension experts, they want an expert to do it for them, like seeing a doctor or taking their car to the garage. Complexity can create paralysis, confusion and risks poor decision-making. Good pension provision should make the complex simple and remove friction rather than add to it. That becomes even more important as the market moves into the next major phase of workplace pensions: retirement support.
The next phase of the master trust market
The challenge ahead is no longer simply helping people save. It is helping millions of savers navigate retirement confidently, often without the financial knowledge or engagement levels the industry has historically assumed. That requires a different level of operational capability, behavioural understanding and investment sophistication than was needed during the early years of auto-enrolment.
The broader direction of travel of government policy underpins that reality. Scheme consolidation, the value-for-money framework, consolidation of small pots, the pensions commission, and default pension plans in retirement are all reinforcing the link between scale, resilience and long-term investment capability and better member outcomes in retirement.
In many ways, the £25bn threshold increasingly looks like the point at which providers earn the right to compete at scale, rather than the point at which they become genuinely differentiated. The providers that succeed over the next decade will be those able to combine scale with strong governance, operational resilience, advanced investment capability and meaningful member support.
Just as importantly, they will need to deliver member experiences that genuinely improve engagement and decision-making throughout the savings journey. Best outcomes for individual savers are rarely achieved through investment performance alone. They come from combining strong investment capability with clearer communication, easier navigation and support that helps members make better decisions over time.
The next phase of the master trust market will not be defined by who helped employers meet auto-enrolment duties a decade ago. It will be defined by which providers can now deliver stronger long-term outcomes for millions of savers.
The labels and assumptions that shaped the market during the early years of auto-enrolment matter far less today than the ability to combine scale, sophistication and operational resilience in ways that genuinely improve member outcomes over the long term.
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