After publishing a Call for Evidence over the summer of 2024 on the first phase (Terms of Reference) of their Pensions Investment Review the UK Government published an Interim Report on 14 November 2024. This puts forward proposals to legislate for a minimum size and maximum number of DC pension scheme default funds, and to legislate to require for the 86 Local Government Pension Scheme (LGPS) administering authorities to consolidate their assets into fewer, larger pools of capital. The Government expect larger DC workplace pension schemes and LGPS to be in a better position to invest in productive assets, be able to deliver greater returns for members of DC schemes, and give greater value for local taxpayers. The report has been accompanied by the publication of two consultations, open until 16 January 2025, for the development of these proposals:
- Unlocking the UK pensions market for growth which sets out proposed reforms to deliver scale, accelerate consolidation and drive a focus on value over cost in the DC workplace pensions market and explores other changes.
- Local Government Pension Scheme (England and Wales): Fit for the future which seeks views on proposals relating to the investments of the LGPS. It covers the areas of asset pooling, UK and local investment and governance.
Also, the Government have analysed the trends of UK pension fund investment and considered the implications for UK econmic growth and published 'Pension fund investment and the UK economy'.
AREF submitted a response to the Call for Evidence in September 2024 and AREF's Pensions Reform Working Group will be considering responses to the two consultations above. Any members who would like to join this working group please advise Jacqui Bungay, Head of Policy ([email protected])
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