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The introduction of the Pension Schemes Bill marks a significant change for the UK pension sector. Yet legislation alone can only do so much. How we and our members think about pensions is equally important.
The UK Government’s Pension Schemes Bill, introduced in June 2025, draws inspiration from international models – particularly Australia and Canada. In both, large-scale schemes have improved efficiency, reduced costs, and delivered stronger outcomes through diversified portfolios and access to alternative assets.,
The creation of ‘megafunds’ in the UK – requiring scheme assets to exceed £25bn by 2030 – will enable broader access to domestic investments. Access to alternative assets should also enhance diversification and strengthen long-term returns.
We believe the new legislation is a positive step, but not a panacea. To truly improve outcomes, we must understand how savers think about pensions and rethink our own approach.
The future is now
Pensions are often viewed in isolation, disconnected from everyday financial pressures – a divide the industry has long reinforced by treating them as standalone products rather than part of overall financial wellbeing.
Yet, choices about mortgages or bills are interwoven with retirement planning. A saver deciding whether to overpay their mortgage or contribute more to their pension is making a trade-off that affects future income
and security.
By recognising these connections and adopting a holistic approach, we can support savers’ immediate needs while securing long-term outcomes. Guided income solutions can balance short-term spending with future growth.
Improving outcomes requires more than good products – it demands a joined-up approach that engages savers early and supports them throughout the journey.
Empowering engagement
The new legislative framework is an opportunity to rethink the saver journey from enrolment to retirement and beyond.
Early engagement is our goal, but it is not guaranteed. Savers have competing priorities, so solutions must be simple, accessible, and supported by timely guidance. Some will still prefer a pension on rails – keeping things simple with minimum effort.
We must assume limited engagement and provide a path to access and spend their savings wisely.
X must mark the spot
Auto enrolment has secured long-term savings for millions across the UK, but its hands-off design has reduced engagement. By placing the burden on employers and providers to manage enrolment and default strategies, it simplifies saving—but often delays saver involvement until retirement is near.
Accumulation strategies generally do a good job of placing savers on the right road to retirement; it’s during decumulation where the journey becomes more uncertain.
Helping the vulnerable
Supporting vulnerable customers is important throughout their lifecycle, particularly near retirement. The shift from passive saving to complex decumulation leaves many savers vulnerable.
Once retirement approaches, they must become ‘experts’ on tax, investments, and decumulation strategies.
We must work harder to set appropriate decumulation strategies, giving members the support to manage their income.
We can help savers set a clear destination by:
▪ Improving support at retirement and beyond through clear, timely communications.
▪ Offering guided income solutions that provide a seamless journey from accumulation to decumulation.
▪ Giving customers flexibility to make their own choices in retirement, backed by support that enables it.
A frictionless retirement
At retirement, savers want the transition from saving to spending to be frictionless, intuitive, and secure. For us, this means designing solutions around three core principles:
▪ Design for the real world– Build systems and support for disengaged savers.
▪ Keep things simple – Provide savers with straightforward, clear options.
▪ Link savings to income – Offer savers a simple investment solution that protects savings when drawing income.
Putting members first
We regularly ask members what matters to them. This enables us to create the best possible outcomes based on our three principles and the Pension Schemes Bill.
The industry must evolve from simply helping people save to helping them spend wisely and sustainably. Seamless, accessible guided income strategies are essential to a holistic approach.
By strengthening support at retirement and beyond, we can harness the benefits of the Pension Schemes Bill and continue putting savers at the heart of everything we do.
I’m looking forward to sharing more about our three core principles and how they can help savers build more sustainable and secure retirements in future updates.
