Skip to main content
Catalyst: DC pensions
DC PENSIONS TECHNICAL UPDATE | AUTUMN EDITION
Notes from our editors
The most reassuring aspect of this edition of Catalyst is the level of self-reflection we’re seeing as we enter the final months of the year.
Across the DC pensions landscape, we’re seeing governing bodies take stock of the current status quo, and take proactive steps to help schemes and members alike achieve their goals. Chief among these is the one-two combination of the relaunch of the Pensions Commission and the review of the State Pension age from the Government, decisions that will have big impacts on retirees for years to come.
It’s also refreshing to see the Financial Conduct Authority not standing still, evolving their approach to climate-related disclosures to make sure the system works for all involved. Similarly, the new data security guidance from the Pensions Administration Standards Association will be a welcome sight for trustees as cyber attacks on UK firms continue to make headlines.
Overall, you get the general sense of an industry tackling the issues at hand, all with the aim of ensuring good outcomes for pension scheme members – a cause we can all get behind.
If good DC governance is high on your agenda, don't forget to register for our 5 November webinar.
Mark Futcher
Partner and
Head of DC
Sonia Kataora
Partner and
Head of DC Investment
At a glance
- UK Government relaunches Pensions Commission to address a growing retirement crisis, with a remit to investigate systemic barriers to pension savings, propose reforms, and build a fair, sustainable pension system ensuring adequate retirement income.
- Call for evidence on the State Pension age also launched, inviting public views and supporting data on future State Pension age considerations.
- The House of Commons Public Bill Committee has commenced its line-by-line scrutiny of the Pension Schemes Bill.
- The Pensions Administration Standards Association (PASA) has issued new guidance on data security and governance.
- Over 50 million private pension records are now connected to the Pensions Dashboard ecosystem.
- The Financial Conduct Authority (FCA) has reviewed its climate disclosure regime and signals intention to simplify its reporting framework.
- The fourth annual Pension Attention campaign has been launched by Pensions UK, fronted by TV personality Ross Kemp and financial coach Bola Sol, aiming to boost public engagement with pension planning.
- The 2024 “Planning and Preparing for Later Life” (PPLL) survey, commissioned by the Department for Work and Pensions (DWP), offers a comprehensive snapshot of how adults in Great Britain aged 40 to 75 are approaching retirement.
- The FCA's annual Retirement Income Market Data report highlights rise in potentially unsustainable withdrawal rates, and decline in individuals seeking regulated financial advice.
Government announces revived Pensions Commission
The UK Government has relaunched the Pensions Commission to tackle a looming retirement crisis, as new data reveals that future pensioners may be financially worse off than today’s.
Despite the success of automatic enrolment, which now covers 88% of eligible employees, nearly half of working-age adults still save nothing for retirement. Vulnerable groups such as low-earners, ethnic minorities, and the self-employed are particularly at risk, with over 3 million self-employed individuals not contributing to pensions and only 1 in 4 low-earners saving.
The revived Commission, led by Baroness Jeannie Drake, Sir Ian Cheshire, and Professor Nick Pearce, will investigate systemic barriers to pension saving and propose reforms by 2027. It aims to create a fair, sustainable pension system that ensures adequate income in retirement.
Analysis undertaken to inform the commission also reveals a stark 48% gender pensions gap in private pension wealth between women and men. A typical woman currently approaching retirement can expect a private pension income worth over £5,000 less than that of a typical man (just over £100 per week for a woman compared to just over £200 a week for a man).
Alongside this, the Government has launched a State Pension age review to assess future eligibility criteria. Stakeholders from business, unions, and advocacy groups have welcomed the move, emphasising the urgency of reform to prevent widespread pensioner poverty and ensure long-term financial security for all workers.
Call for evidence on the State Pension age
The Pensions Act 2014 requires the Government to review State Pension age at least every six years.
On 18 August 2025, the Department for Work and Pensions (DWP) initiated a call for evidence as part of the third review of the State Pension age and Dr Suzy Morrisey, Deputy Director of the Pensions Policy Institute, was appointed to prepare an independent report ahead of the review.
Dr Morrisey invites views and supporting evidence on the key considerations the Government should consider when setting the State Pension age for future decades.
The consultation will explore factors such as:
- The potential benefits and drawbacks of linking State Pension age to life expectancy,
- The role of State Pension age in ensuring the long-term sustainability of the pension system,
- International approaches to automatic adjustment mechanisms.
Details on the call for evidence can be found here. The deadline for submissions is 24 October 2025.
Public Bill Committee scrutinises Pension Schemes Bill
The House of Commons Public Bill Committee commenced its line-by-line scrutiny of the Pension Schemes Bill on Tuesday 2 September 2025, with oral evidence sessions taking place that day. The Committee is expected to report by 5.00pm on Thursday 23 October 2025. This detailed scrutiny phase represents a critical opportunity for stakeholders to influence the final shape of the legislation before it receives Royal Assent, expected in 2026.
Prior to the meeting, there was a call for evidence and Barnett Waddingham responded on three DC specific questions. The link to our response is provided here.
We provided an overview of the detail of the Bill that is relevant for DC schemes in our Special Edition of Catalyst.
Key developments and implications
The Committee has been considering amendments across all aspects of the Bill, including provisions on Value for Money, small pot consolidation, DC scale requirements, and the reserve power to mandate investment in productive assets.
Multiple industry bodies have submitted written evidence to the Committee, with organisations including the Association of British Insurers, the Society of Pension Professionals, and Universities Superannuation Scheme raising concerns about specific provisions. Notably, industry feedback has highlighted concerns about the proposed reserve power to mandate investment allocations, with some arguing this creates uncertainty around legal accountability for investment underperformance and risks distorting market pricing. The Committee has also considered amendments relating to the Virgin Media case on actuarial confirmation requirements and proposals for additional member protections.
For DC schemes, the Committee stage provides clarity on how the government intends to implement the ambitious reforms outlined in the Bill. The debates have revealed ministerial intent around key areas such as the definition of "common investment strategy" for meeting the £25 billion scale threshold, the safeguards that will apply to bulk transfers without consent, and the circumstances under which the Secretary of State might exercise reserve powers. The Committee's amendments and the government's responses are being published progressively, allowing trustees to understand how the legislative framework is evolving ahead of the detailed regulations that will follow.
Action for Trustees
- Monitor the Committee's published amendments and debate transcripts, available on the Bill's publications page, to understand how provisions affecting your scheme may change before Royal Assent.
- Review written evidence submitted by industry bodies representing your scheme type to understand sector-wide concerns and proposed solutions.
- Continue to engage with your advisers and industry representatives to prepare for the regulatory changes that will follow, particularly around Value for Money assessments and scale requirements that will come into effect from 2028 onwards.
- Engage with advisers to assess implications for decumulation defaults and productive investments, ensuring fiduciary duties are met amid potential mandation risks.
PASA issues new guidance on data security and governance
On 4 August 2025, the Pensions Administration Standards Association (PASA) published new guidance titled 'Securing Tomorrow', aimed at helping trustees and pension providers strengthen data security and governance.
The guidance provides a practical toolkit to support schemes in managing growing digital risks and includes advice on:
- Vetting and monitoring third-party providers
- Conducting regular security reviews and integrating them into Effective Systems of Governance (ESOG) frameworks
- Developing incident response plans and data communication strategies
- Preparing for risks linked to emerging technologies, including AI.
PASA emphasises that trustees are custodians of sensitive member data and must take proactive steps to protect it. The guidance complements existing regulatory frameworks and encourages a culture of awareness across all stakeholders.
Action for Trustees
- Consider the guidance and liaise with key providers to understand risks and processes;
- Develop an incident response plan.
Quick updates
- The Pensions Dashboard Programme confirmed in an update in September 2025 that over 50 million private pension records are now connected to the pensions dashboard ecosystem, which represents over two thirds of records in scope for connection and is in addition to the tens of millions of State Pension records that have already been connected. Schemes with between 100-124 members should have just under a year to complete connection.
- Action: If you are a trustee of a smaller scheme not yet connected, you should liaise with your provider to ensure everything is on track to meet your connection date.
- The FCA published the findings of its multi-firm review of climate-related disclosures on 6 August 2025, examining how its 2021 rules requiring Task Force on Climate-related Financial Disclosures (TCFD)-aligned reporting have been working for asset managers, life insurers and FCA-regulated pension providers. The review found that while the rules have successfully increased firms' consideration of climate risks and improved transparency, firms have encountered challenges with data availability, methodology development, and regulatory burden.
- Action: With evolution of the climate reporting regime expected, trustees should prepare by staying informed about the FCA's planned transition to ISSB standards and ensuring their scheme's ESG framework and Statement of Investment Principles remain aligned with emerging best practice in climate risk management and disclosure.
Pension Attention Campaign 2025 – Strengthen Your Pension
The fourth annual Pension Attention campaign launched in September, fronted by TV personality Ross Kemp and financial coach Bola Sol, aiming to boost public engagement with pension planning.
Coordinated by the Association of British Insurers (ABI) and Pensions UK, the campaign uses a fitness-themed approach to highlight the importance of financial health. Kemp stars in a humorous advert urging Brits to “gain pounds” for the future, drawing attention to the fact that while many prioritise physical fitness, far fewer actively manage their pensions.
Recent research shows that although 37% of UK adults have made healthy lifestyle changes and 30% have set fitness goals, only 29% have taken steps to organise their finances for retirement. The campaign encourages people to follow a simple three-step “pension fitness plan”: recall past pensions, check current balances, and estimate future needs. It also calls on employers and the wider pensions industry to support the initiative and help workers become “retirement ready.”
Minister for Pensions Torsten Bell and campaign spokesperson Mark Smith emphasise the need to treat pension planning with the same urgency as physical health. By aligning financial and physical wellness, the campaign hopes to engage those who have never considered their pensions before.
Action: During Pension Engagement season, liaise with your pension provider to understand what educational materials can still be shared to increase engagement.
Government’s Planning and Preparing for Later Life 2024 Survey
The 2024 'Planning and Preparing for Later Life' (PPLL) survey, commissioned by the Department for Work and Pensions to gather and understand evidence for policy development, offers a comprehensive snapshot of how adults in Great Britain aged 40 to 75 are approaching retirement. Based on responses from over 4,000 participants, the report highlights shifting attitudes, financial preparedness, and challenges in pension planning.
Key findings reveal that 60% of people aged 40 to 75 in paid work want to reduce hours as they near retirement, with 46% citing flexible work arrangements as a way to extend their careers. While 75% of those in the same age group have a private pension, access is uneven with 54% of those without one saying that affordability is a barrier.
Alarmingly, 38% of this group have no savings, and 20% have less than £15,000. Among renters, 78% of social and 66% of private tenants report having no savings, compared to just 17% of outright homeowners.
Action: Work with your pension provider or a communications specialist to increase engagement, consider targeted communication including signposting modelling tools and information on benefit options.
FCA Retirement Income Market Data 2024/25
The FCA's Retirement Income Market Data report is a yearly publication that provides data to monitor developments in the UK retirement income market, focusing on how consumers access and use their pension pots. The report includes data on the number and value of pension plans accessed, withdrawals, the use of advice, types of annuity options, and defined benefit to defined contribution transfers. It allows the FCA to track consumer actions at retirement and assess the functioning of the market to inform consumers and policymakers.
The FCA has collected data on the retirement income market since April 2015.
The 2024/25 report, published on 16 September 2025, highlights a growing trend of potentially unsustainable withdrawal rates and a decrease in individuals seeking regulated financial advice when accessing their pension pots.
Action: Review your scheme's member communications and at-retirement support to ensure members understand the implications of different withdrawal strategies and the risks of taking lump sums based solely on speculation about future tax changes.
Webinar: Getting DC pensions right
Wednesday 5 November, 11-12pm
Join our November webinar for expert insight into building a clear DC strategy, establishing strong governance, and a focus on meeting employee needs.
