DWP confirms multiple default consolidator plans

The Department for Work and Pensions confirmed at the Autumn Statement that it would go ahead with plans to tackle lost pension pots through a multiple default consolidator¹. Under the model, workplace pensions worth less than £1,000 that have had no active contributions for 12 months will be automatically transferred to an authorised consolidator¹. Proposals are due to be published in late 2024¹.

The confirmation sits alongside a separate reform. During the Autumn Statement the Chancellor announced that the government will explore the potential for reforms to allow people to choose their own pension scheme for automatic enrolment, rather than join their employer's default arrangement¹. The government has launched a call for evidence on this new pension model, which would allow people to have one "pension pot for life"¹.

The background is the number of pots people build up. Since automatic enrolment was introduced in 2012, nearly 11 million people have been enrolled in a workplace pension, many for the first time, and the rules require enrolment into a defined contribution scheme at each new workplace¹. The average worker builds up 12 pensions in their life¹. Four in 10 pension savers are unsure whether they should consolidate their retirement pots, according to a survey by investment firm Hargreaves Lansdown¹.

A parallel programme intended to help people see their pots in one place has slipped. The pensions dashboard initiative is designed to let people view all their pensions, including the state pension, online, but the programme has faced significant delays, with the deadline for schemes to connect now set for 31 October 2026¹.

Why it matters for households

The consolidator applies to a defined group: pots below £1,000 that have received no contributions for 12 months¹. For anyone holding several small pots from short periods of employment, the transfer would happen automatically rather than requiring an application, once the model is in place. The timing is not fixed: proposals are due in late 2024, so no transfer date has been reported¹.

The pot for life proposal is at an earlier stage. It concerns whether an employee could nominate their own scheme for automatic enrolment instead of joining the employer's default arrangement, and the government has opened a call for evidence rather than legislating¹. No eligibility rules or start date for that model have been reported¹.

Separately, the pensions dashboards connection deadline of 31 October 2026 is later than originally planned, which affects when savers can expect to view all their pots, including the state pension, in one place¹.

What happens next

Proposals for the multiple default consolidator are due to be published in late 2024¹. The call for evidence on the pot for life model is open¹. The deadline for schemes to connect to pensions dashboards is 31 October 2026¹.