Government announces pension system review

Sir Keir Starmer has made it clear that tackling the UK’s faltering economic growth is one of the core priorities of his new government.

The King’s speech - written by government ministers - included a new Pensions Schemes Bill. The bill would seek to encourage consolidation of smaller pension schemes and widen investment strategies.

‘Big bang reforms’

"The review we are announcing is the latest in a 'big bang' of reforms to unlock growth, boost investment and deliver savings for pensioners," Finance Minister Rachel Reeves revealed.

"I am determined to fix the foundations of our economy."

Writing in the Mail on Sunday, Ms Reeves said the Conservatives had “promised action” to reform pensions, but “failed to deliver” over 14 years in office.

She said: “Not only is the current system not delivering the retirement savings it should, but it is not doing what it should to support some of our great British businesses.”

Reeves added: “Where they have failed, I will act.”

Defined contribution schemes manage a considerable amount of assets, and the government is looking to invest in more productive assets such as infrastructure.

‘Critical’ reforms required

Barclays chief executive C. S. Venkatakrishnan welcomed the announcement, noting that pension reforms are ‘critical’ to unlocking institutional investment in growth equity.

Closing thoughts

It will be fascinating to see how the new government impacts the current pension system. If you are looking for advice when it comes to your pension then don’t hesitate to get in touch to arrange a meeting with one of our trusted advisers.