Pension adequacy is one of the significant challenges of our time, and sadly the Government has decided to do little about it.
The Pensions Minister may have hailed this legislation as the ‘big, beautiful bill,’ but the reality is far less glamorous. Ultimately, the Bill fails to improve the retirement prospects of millions of savers across the UK.
Astonishingly, for one of the richest countries in the world, only 36% of us are on track to hit a ‘comfortable’ standard of living in retirement. This should be a wake-up call for all policy makers. Instead, the Government have hit the snooze button.
The Bill contains some sensible measures, many of which were proposed by the previous Conservative Government, but overall, it is a wasted opportunity.
First, there’s still no meaningful clarity on the future of the Pensions Dashboard, the tool that should let savers view all of their pension pots in one place. Years of dither and delay are actively undermining pension engagement.
Second, the Bill hands the Government new powers to mandate how pension scheme trustees invest. This means that your pensions could be funnelled into white elephant infrastructure projects such as HS2, rather than actually taking into account the best interests of savers.
And worst of all, the Bill doesn’t contain a single reference to pension adequacy. This omission speaks volumes. It is hard not to conclude that this legislation is not designed to help achieve better retirement outcomes, but intended to bolster the Government’s Balance Sheet.
We need a long-term plan to improve pension adequacy. The Bill shows, all too clearly, that the Government has neither the focus nor the capability to do so.
