- New Value for Money framework will for the first time require pension schemes to measure and publish how they perform against the best in the market
- Transparency will help tackle a performance gap that is currently leaving an average member £5,000 worse off over 5 years.
- A timetable to deliver the landmark Pensions Act gives industry certainty for next stage of reforms.
- Default pensions will help millions convert their savings into a decent retirement income.
Developed with the Pensions Regulator (TPR), the Financial Conduct Authority (FCA), HMT and key industry partners, the plan will boost the retirement pots of pension savers and give industry clarity over the delivery timetable for these landmark reforms.
The centrepiece is a new Value for Money framework designed to drive up standards and ensure savers get the best possible returns. Savers will be able to see how the returns their pension scheme delivers compares to others, while the poorest performing schemes will have to improve or close. Schemes will be assessed on their investment performance, costs and charges, and quality of service, and rated from red (for poor value) through to green (outperforming on value).
Where they fail to act, regulators can issue compliance notices, levy fines, or in serious cases take steps to wind up the scheme.
From 2028, larger schemes, including Master Trusts, large single employer schemes, and multi-employer contract-based schemes which are open to new employers, will complete and publish these Value for Money assessments. The changes will be rolled out to all workplace pension schemes from 2029.
Torsten Bell, Minister for Pensions, said
Our task is to level up the quality of the pensions private sector workers receive, towards those in the public sector. For the first time, we’re making sure savers can see whether they are getting a good deal from the pension they’re saving into.
We can’t have people working hard to earn the money they save towards retirement, only to have those funds sitting in schemes that aren’t working just as hard on their behalf.
The stakes are high, when the gap between the best and worst performers could cost a saver with a £10,000 pot over £5,000 across just five years.
This is part of the biggest pension reforms for a generation, which are now entering the delivery phase that we are publishing the timeline for today. They represent a wide consensus across the pensions industry, who have helped shape plans that also tackle the proliferation of small pension pots, drive the move to bigger and better pensions schemes, and simply the process for savers of turning their hard earned savings into a decent retirement income.
The Government has also published a discussion paper on its flagship scale policy – which will build a market of fewer, larger and better pensions schemes and is inviting industry views on how scale will be assessed. From April 2030, automatic-enrolment schemes in scope must reach at least £25 billion of assets under management, or have at least £10bn with a credible growth plan to reach £25bn by 2035. These megafunds will drive up returns for savers via lower fees, higher returns and more diversified investments.
Sarah Pritchard, the FCA’s deputy chief executive, said
This framework puts savers first. For the first time, it creates a consistent way to compare value across workplace pensions, bringing transparency to the outcomes that really matter.
Together with the Department for Work and Pensions and The Pensions Regulator, we’re building a pensions market that is more transparent, more accountable, and works better for everyone.
Default pensions will also be introduced so that savers reaching retirement will be able to convert their savings into a reliable retirement income. This means that, whilst individuals will always be free to choose a different option if they prefer, the system will no longer rely on savers having to navigate complex financial decisions alone in order to get a decent retirement income.
Richard Knox, TPR’s Executive Director, Strategy, Policy and Analysis, said
Better value and good outcomes at retirement, built on a system with real transparency, are at the heart of pensions reform.
The value for money framework, developed in close collaboration between government, regulators and the industry, is a major milestone. Under it, schemes will for the first time be able to reliably compare their performance against the best in the market.
The timeline published today provides further clarity as the pensions industry prepares for these vital reforms.
This delivery plan follows the Pension Schemes Act, which will deliver better outcomes for savers, benefitting millions with an average saver seeing their pension pot boosted by £29,000 by retirement.
The Lady Mayor of the City of London, Dame Susan Langley, said
The ambition for our pensions sector is clear bigger pools of capital, greater diversification, and a laser focus on delivering better returns for savers.
The Mansion House Compact and the Mansion House Accord – co-signed by Conservative and Labour Chancellors – represent a significant structural shift in how our pension funds are invested. That cross-party consensus speaks to the urgency of this agenda.
But ambition needs architecture. We now need the strategy and vehicles in place to turn these commitments into results for the millions of savers whose financial futures depend on getting this right. I welcome the Minister’s commitment and look forward to the progress ahead.
Dr Yvonne Braun, Director of Long-Term Savings Policy at the ABI, said
Pensions need a long-term plan. The Pension Schemes Act sets a clear direction of travel, but a roadmap is essential to lay clearer milestones for the next phase of pension reform. Delivering lasting change will require close partnership between government, industry and regulators acting in the interests of pension savers. The implementation programme must be clear and coordinated, with regulatory alignment at its heart, to help ensure reforms achieve their objectives and deliver better outcomes for savers. We look forward to playing our part in delivering these reforms and continuing to work on wider priorities including pension adequacy, consolidation and supporting productive investment.
Helen Forrest Hall, the PMI’s Chief Strategy Officer, said
The Pensions Roadmap is a vital opportunity to provide the long-term certainty and strategic direction needed to build a stronger, more resilient pensions system. At a time when public and private sector capacity is stretched, finite resources must be focused on the reforms that will have the greatest impact for savers. The Government’s commitment to a clear, phased plan must now be matched by decisive action across the pensions community. We cannot afford to stand still. Working together, the industry can build a pensions system that delivers lasting value for savers and the UK economy by investing in professional education, strengthening governance and driving transparency.
We welcome the Government’s roadmap for pension reform and the clear timetable it sets out for delivering the measures in the Pension Schemes Act. Providing greater certainty on the direction and pace of change will help the industry plan effectively and continue its focus on improving outcomes for savers.
It is particularly encouraging to see the close collaboration between the DWP, Treasury, FCA, TPR and industry partners in shaping and implementing these changes. This approach will be crucial to ensuring changes are delivered successfully and in a way that works for savers.
At the heart of the roadmap is the Value for Money framework. Moving beyond a historic focus on cost alone, towards a broader assessment of long-term value and savers outcomes is an important step in helping more people achieve a better retirement.
Gareth Stears, Deputy Chair of the SPP’s Administration Committee, said
The pensions industry has never shied away from change, but the volume of reforms currently in train shows clear planning is more important than ever.
A roadmap is valuable because it allows schemes, administrators and providers to plan investment, allocate resources, train staff and deliver change in a way that maintains good outcomes for members. Without that certainty, there is a real risk that multiple reforms compete for the same finite operational capacity.
If the government can maintain a clear sequence of reforms, avoid unnecessary changes of direction and allow sufficient implementation time, the industry will be in a much stronger position to deliver lasting improvements for pension savers.
Good pensions policy isn’t just about deciding what to change. It’s about ensuring those changes can be implemented successfully. The roadmap is an important step towards achieving that.
Additional Information
- There is a wide range in investment performance across the DC market Annualised 5-year returns for younger savers range from around 5% to 13% across a sample of large pension schemes. This means for a pot of £10,000, assuming no further contributions and an annual charge of 0.5%, the pot size would differ by more than £5,000 depending on the scheme after 5 years of saving. (source CAPAdata Q1 2026).