Latest news with #LocalGovernmentPensionScheme
Daily Mirror
a day ago
- Business
- Daily Mirror
UK workers to get £29,000 pension boost under new retirement rules
Small pension pots worth £1,000 or less would be consolidated into larger schemes under the new Pension Schemes Bill, which returns to Parliament for its second reading today Pension savers could get a boost of up to £29,000 by the time they retire thanks to major new legislation, according to Government figures. Small pension pots worth £1,000 or less would be consolidated into larger schemes under the new Pension Schemes Bill, which returns to Parliament for its second reading today. As well as creating better opportunity for growth, Labour says this would help solve the issue of people losing track of multiple small pension pots. You can end up with lots of small pots if you change jobs regularly, or if you've changed address and you didn't update your pension provider with your details. Labour estimates that working people on an average salary who save into a pension pot over their career could get up to £29,000 extra by the time they retire. It is thought 20 million pension savers would benefit. In future, pension schemes will also need to prove they are value for money and help savers understand whether their scheme is giving them good returns. Another measure included the bill is a plan to move billions of pounds of pension savings into larger "megafunds". This is where smaller local authority and private workplace schemes are consolidated together, in the hope that larger funds will generate greater returns. There are similar schemes that run in Australia and Canada. Minister for Pensions, Torsten Bell said: 'We're ramping up the pace of pension reform, to ensure that people's pension savings works as hard for them as they worked to save. 'The measures in our Pension Schemes Bill will drive costs down and returns up on workers' retirement savings – putting more money in people's pockets to the tune of up to £29,000 for an average earner and delivering on our Plan for Change.' Minister for Local Government and English Devolution, Jim McMahon OBE said: 'This Bill will ensure the Local Government Pension Scheme is fit for the future and harness its full potential, with assets due to reach £1 trillion by 2040, and will strengthen investment in local communities to accelerate growth as part of our Plan for Change.' Zoe Alexander, Director of Policy and Advocacy for Pensions and Lifetime Savings Association: 'The introduction of the Pension Schemes Bill is a significant milestone, bringing forward necessary legislation to enact important reforms that have the full backing of the pensions industry. 'This includes small pots consolidation, the Value for Money regime, decumulation options and changes to give DB funds more options for securing member benefits over the long-term. 'Once fully implemented, these measures should reduce the cost of administering pensions, remove complexity for savers and help ensure schemes are maximising the value they provide members.'
Daily Mirror
06-06-2025
- Business
- Daily Mirror
DWP launches major pension shake-up to make 20million Brits £1,000 better off
The Department for Work and Pensions (DWP) will merge all smaller pension pots holding less than £1,000 together. This will help increase the returns on them and give Brits more money in retirement A major Department for Work and Pensions (DWP) was introduced this week and its set to boost the retirement savings by over £1,000 for over 20million Brits. Labour launched its new Pension Schemes Bill yesterday which it hopes will make pensions simpler to understand and manage. The goal of the bill is to "drive better value over the long term" to give people more money when they come to retire. The most significant part of the bill is the DWP's plan to merge smaller pension pots together. The benefits and pensions department says having multiple small pots often leads to a small return for savers. This is because they have to pay multiple flat rate charges. However, by consolidating the smaller pots into larger ones, the returns will increase. Labour says it could potentially boost retirement savings by around £1,000. The bill will merge all pension pots holding less than £1,000 together into one pot for each individual. Currently, there are around 13million pension pots which have less than a grand in them. The Bill also introduces a new system to show how well pension schemes are performing. This will cover "Defined Contribution" (DC) schemes, which are a type of private pension that you contribute to on a regular basis. The DWP says this will help savers understand whether their scheme is giving them good value. If it's not, Brits will be able to move their savings somewhere. The Bill will also require schemes to offer "clear default" options to grow pension pots for those approaching retirement. This means people will have "clearer, more secure routes to decide how they use their pension money over time." Other measures part of the bill include: Implementing new rules creating multi-employer DC scheme 'megafunds' of at least £25billion, so that "bigger and better pension schemes can drive down costs and invest in a wider range of assets" Consolidating and professionalising the Local Government Pension Scheme (LGPS), with assets held in six pools that can invest in local areas infrastructure, housing and clean energy Increased flexibility for Defined Benefit (DB) pension schemes to safely release surplus worth collectively £160billion, to support employers' investment plans and to benefit scheme members Major players within the pension sector, including Phoenix Group, NEST, Now Pensions, and Royal London, have supported the new bill. The Pensions Regulator and the Pension Protection Fund (PPF) have also welcomed the bill. Work and Pensions Secretary Liz Kendall said: "Hardworking people across the UK deserve their pensions to work as hard for them as they have worked to save, and our reforms will deliver a huge boost to future generations of pensioners. Join Money Saving Club's specialist topics For all you savvy savers and bargain hunters out there, there's a golden opportunity to stretch your pounds further. The Money Saving Club newsletter, a favourite among thousands who thrive on catching the best deals, is stepping up its game. Simply follow the link and select one or more of the following topics to get all the latest deals and advice on: Travel; Property; Pets, family and home; Personal finance; Shopping and discounts; Utilities. 'The Bill is about securing better value for savers' pensions and driving long-term investment in British businesses to boost economic growth in our country. 'As part of our Plan for Change we're helping people find work, stay in work, and ensuring that work pays them back to give them the secure income in retirement they deserve.' Chancellor of the Exchequer Rachel Reeves said: "The Bill is a game changer, delivering bigger pension pots for savers and driving £50 billion of investment directly into the UK economy– putting more money into people's pockets through the Plan for Change.' Minister for Pensions Torsten Bell added: "We are ramping up the pace of pensions reform. Workers deserve to get better bang for each buck saved, and these sweeping reforms will make sure they do. 'Pension saving is a long game, but getting this right is urgent so that millions can look forward to a higher income in retirement.'
South Wales Argus
05-06-2025
- Business
- South Wales Argus
New pension changes for 20m people in Pension Schemes Bill
The Government's new Pension Schemes Bill is designed to support working people plan for their retirement by making pensions simpler to understand, easier to manage, and drive better value over the long term. Keeping track of pensions is notoriously challenging, with the average worker accumulating 11 different pension pots over their lifetime. This has resulted in £26.6 billion in lost pensions across the UK, according to the Pensions Policy Institute and the Association of British Insurers. One of its biggest benefits is the merging of small pension pots. The bill also introduces a new system to show how well pension schemes are performing, this will help savers understand whether their scheme is giving them good value and protect them from getting stuck in underperforming schemes for years on end, to help working people feel more secure about their retirement savings. For those approaching retirement, the changes will mean clear default options for turning savings into a retirement income. This means people will have clearer, more secure routes to decide how they use their pension money over time. The full changes are listed in detail here. Work and Pensions Secretary Liz Kendall says: "Hardworking people across the UK deserve their pensions to work as hard for them as they have worked to save, and our reforms will deliver a huge boost to future generations of pensioners." Chancellor of the Exchequer Rachel Reeves describes the bill as "a game changer", giving "bigger pension pots for savers and driving £50 billion of investment directly into the UK economy– putting more money into people's pockets." Government launches plans to automatically combine small pension pots, here's what it's likely to mean for you... — Martin Lewis (@MartinSLewis) April 24, 2025 What do these pension changes mean for workers? The bill will transform the £2 trillion pensions landscape to ensure savers get good returns for each pound they save, and drive investment into the economy, through a suite of measures, including: Requiring DC schemes to prove they are value for money, to protect savers from getting stuck in underperforming schemes. Simplifying retirement choices, with all pension schemes offering default routes to an income in retirement. Bringing together small pension pots worth £1,000 or less into one pension scheme that is certified as delivering good value to savers, making pension saving less hassle and more rewarding. New rules creating multi-employer DC scheme 'megafunds' of at least £25 billion, so that bigger and better pension schemes can drive down costs and invest in a wider range of assets. Consolidating and professionalising the Local Government Pension Scheme (LGPS), with assets held in six pools that can invest in local areas infrastructure, housing and clean energy. Increased flexibility for Defined Benefit (DB) pension schemes to safely release surplus worth collectively £160 billion, to support employers' investment plans and to benefit scheme members. What is the difference between a Defined Benefit (DB) scheme and a Defined Contribution (DC) pension? There are two different ways pension schemes work. With a Defined Benefit (DB) pension scheme, also referred to as final salary pension schemes, the amount you get is usually based on your salary and how long you've been part of the pension scheme. For a Defined Contribution (DC) pension, the figure you get is based on how much you and your employer invest in the pension and how your investments perform. Recommended reading: What's the expert view on the new pension changes? Nausicaa Delfas, chief executive of The Pensions Regulator (TPR) says: "The Pension Schemes Bill is a once in a generation opportunity to address unfinished business in the UK pension system. "Making sure all schemes are focused on delivering value for money, helping to stop small, and often forgotten pension pots forming, and guiding savers towards the right retirement products for them, will mean savers benefit from a system fit for the future. "We have long advocated for fewer, larger well-run schemes with the size and skill to deliver better outcomes for savers. As such we are also pleased to see the proposed legislative framework for DB superfunds, providing options and choice in defined benefit consolidation." Andy Briggs, CEO, Phoenix Group says: "The bill sets a clear direction for the future of pensions with the emphasis on building scale and ensuring savers receive value for money. "People across the country will feel the impact of these changes with plans to consolidate small pots, ensure the dashboard delivers and provide default retirement income options at the point of retirement. Patrick Heath-Lay, Chief Executive, People's Partnership adds: "This is a pivotal moment in pension reform. The bill contains many measures that will require providers to deliver better outcomes for savers and improve the workplace pension system."
Powys County Times
05-06-2025
- Business
- Powys County Times
New pension changes for 20m people in Pension Schemes Bill
Pension changes introduced today could make managing accounts easier for millions of workers planning their retirement across the UK. The Government's new Pension Schemes Bill is designed to support working people plan for their retirement by making pensions simpler to understand, easier to manage, and drive better value over the long term. Keeping track of pensions is notoriously challenging, with the average worker accumulating 11 different pension pots over their lifetime. This has resulted in £26.6 billion in lost pensions across the UK, according to the Pensions Policy Institute and the Association of British Insurers. One of its biggest benefits is the merging of small pension pots. The bill also introduces a new system to show how well pension schemes are performing, this will help savers understand whether their scheme is giving them good value and protect them from getting stuck in underperforming schemes for years on end, to help working people feel more secure about their retirement savings. For those approaching retirement, the changes will mean clear default options for turning savings into a retirement income. This means people will have clearer, more secure routes to decide how they use their pension money over time. The full changes are listed in detail here. Work and Pensions Secretary Liz Kendall says: "Hardworking people across the UK deserve their pensions to work as hard for them as they have worked to save, and our reforms will deliver a huge boost to future generations of pensioners." Chancellor of the Exchequer Rachel Reeves describes the bill as "a game changer", giving "bigger pension pots for savers and driving £50 billion of investment directly into the UK economy– putting more money into people's pockets." Government launches plans to automatically combine small pension pots, here's what it's likely to mean for you... — Martin Lewis (@MartinSLewis) April 24, 2025 What do these pension changes mean for workers? The bill will transform the £2 trillion pensions landscape to ensure savers get good returns for each pound they save, and drive investment into the economy, through a suite of measures, including: Requiring DC schemes to prove they are value for money, to protect savers from getting stuck in underperforming schemes. Simplifying retirement choices, with all pension schemes offering default routes to an income in retirement. Bringing together small pension pots worth £1,000 or less into one pension scheme that is certified as delivering good value to savers, making pension saving less hassle and more rewarding. New rules creating multi-employer DC scheme 'megafunds' of at least £25 billion, so that bigger and better pension schemes can drive down costs and invest in a wider range of assets. Consolidating and professionalising the Local Government Pension Scheme (LGPS), with assets held in six pools that can invest in local areas infrastructure, housing and clean energy. Increased flexibility for Defined Benefit (DB) pension schemes to safely release surplus worth collectively £160 billion, to support employers' investment plans and to benefit scheme members. What is the difference between a Defined Benefit (DB) scheme and a Defined Contribution (DC) pension? There are two different ways pension schemes work. With a Defined Benefit (DB) pension scheme, also referred to as final salary pension schemes, the amount you get is usually based on your salary and how long you've been part of the pension scheme. For a Defined Contribution (DC) pension, the figure you get is based on how much you and your employer invest in the pension and how your investments perform. Recommended reading: What's the expert view on the new pension changes? Nausicaa Delfas, chief executive of The Pensions Regulator (TPR) says: "The Pension Schemes Bill is a once in a generation opportunity to address unfinished business in the UK pension system. "Making sure all schemes are focused on delivering value for money, helping to stop small, and often forgotten pension pots forming, and guiding savers towards the right retirement products for them, will mean savers benefit from a system fit for the future. "We have long advocated for fewer, larger well-run schemes with the size and skill to deliver better outcomes for savers. As such we are also pleased to see the proposed legislative framework for DB superfunds, providing options and choice in defined benefit consolidation." Andy Briggs, CEO, Phoenix Group says: "The bill sets a clear direction for the future of pensions with the emphasis on building scale and ensuring savers receive value for money. "People across the country will feel the impact of these changes with plans to consolidate small pots, ensure the dashboard delivers and provide default retirement income options at the point of retirement. Patrick Heath-Lay, Chief Executive, People's Partnership adds: "This is a pivotal moment in pension reform. The bill contains many measures that will require providers to deliver better outcomes for savers and improve the workplace pension system."
Daily Mirror
04-06-2025
- Business
- Daily Mirror
DWP pension shake-up to give 20million Brits major boost to retirement savings
Labour's new Pension Schemes Bill is designed to help working people plan for their retirement by making pensions simpler to understand and manage and " driving better value over the long term" The Department for Work and Pensions (DWP) says the new pension shake-up introduced today will boost the retirement savings of over 20million Brits. Labour's new Pension Schemes Bill is designed to help working people plan for their retirement by making pensions simpler to understand and manage and " driving better value over the long term." One of the main parts of the bill will be the merger of small pension pots. The DWP says having multiple small pots can stop savers getting a good return on their retirement fund if they have to pay multiple flat rate charges. The new bill will move small pension pots holding £1,000 or less into one for each Brit - there are currently around 13million pension pots with less than a grand in them. The Bill also introduces a new system to show how well pension schemes are performing. This will cover "Defined Contribution" (DC) schemes, which are a type of private pension that you contribute to on a regular basis. The DWP says this will help savers understand whether their scheme is giving them good value. If it's not, Brits will be able to move their savings somewhere. The Bill will also require schemes to offer "clear default" options to grow pension pots for those approaching retirement. This means people will have "clearer, more secure routes to decide how they use their pension money over time." Other measures part of the bill include: Implementing new rules creating multi-employer DC scheme 'megafunds' of at least £25billion, so that "bigger and better pension schemes can drive down costs and invest in a wider range of assets" Consolidating and professionalising the Local Government Pension Scheme (LGPS), with assets held in six pools that can invest in local areas infrastructure, housing and clean energy Increased flexibility for Defined Benefit (DB) pension schemes to safely release surplus worth collectively £160billion, to support employers' investment plans and to benefit scheme members Major players within the pension sector, including Phoenix Group, NEST, Now Pensions, and Royal London, have supported the new bill. The Pensions Regulator and the Pension Protection Fund (PPF) have also welcomed the bill. Work and Pensions Secretary Liz Kendall said: "Hardworking people across the UK deserve their pensions to work as hard for them as they have worked to save, and our reforms will deliver a huge boost to future generations of pensioners. Sign up to Mirror Money's newsletter for the latest advice and news From universal credit to furlough, employment rights, travel updates and emergency financial aid - we've got all of the big financial stories you need to know about right now. Sign up to our Mirror Money newsletter here. 'The Bill is about securing better value for savers' pensions and driving long-term investment in British businesses to boost economic growth in our country. 'As part of our Plan for Change we're helping people find work, stay in work, and ensuring that work pays them back to give them the secure income in retirement they deserve.' Chancellor of the Exchequer Rachel Reeves said: "The Bill is a game changer, delivering bigger pension pots for savers and driving £50 billion of investment directly into the UK economy– putting more money into people's pockets through the Plan for Change.' Minister for Pensions Torsten Bell added: "We are ramping up the pace of pensions reform. Workers deserve to get better bang for each buck saved, and these sweeping reforms will make sure they do. 'Pension saving is a long game, but getting this right is urgent so that millions can look forward to a higher income in retirement.'
