Chancellor launches Pensions Investment Review

The Chancellor launched the Pensions Investment Review on 20 July 2024, according to the government's collection page for the review¹. The review examined the defined contribution (DC) workplace pensions market and the Local Government Pension Scheme in England and Wales (the LGPS)¹. Its stated objectives were "tackling fragmentation, boosting investment, increasing saver returns and addressing waste in the pensions system"².

An Interim Report was published on 14 November 2024, and the Final Report, published on 29 May 2025, sets out the review's final policy positions¹. It was published alongside responses to two consultations: "Unlocking the UK pensions market for growth" and "Local Government Pension Scheme in England and Wales: Fit for the future"¹. The government says legislation to implement the reforms will form part of the forthcoming Pension Schemes Bill¹.

The Final Report states that over £2 trillion of assets are managed by the workplace pensions system². On the DC market, it says the government will legislate through the Pension Schemes Bill to require that providers and master trusts must have £25 billion in assets under management (AUM) by 2030². The requirement will apply at the arrangement level, so a provider must have at least one main default arrangement meeting it by 2030, and it will apply only to multi-employer schemes, not single-employer trusts². A provider or master trust able to demonstrate it will have at least £10 billion in AUM in an arrangement by 2030 can apply to be on a transition pathway, with a plan to reach £25 billion by 2035². The scale requirements will not apply to CDC pension schemes².

On the LGPS, the report gives its value as £400 billion, with 6.7 million members, and says it is set to grow to £1 trillion by 2040². The consultation response confirms a March 2026 deadline for administering authorities and pools, which remain in their current partnerships, to meet requirements².

Why it matters for households

The review covers two parts of the pensions landscape that hold savers' money. The DC workplace market is where most private sector employees are automatically enrolled, and the report says the government wants larger, consolidated schemes². The £25 billion AUM requirement by 2030, applied at arrangement level, is a dated requirement on providers and master trusts, not on individual savers². The report also says the government will legislate to prevent new default arrangements from being created and operated, except in certain circumstances with regulatory approval².

For the LGPS, which covers 6.7 million members in England and Wales, the report describes the changes as "the most significant reform of the LGPS in a generation"². The March 2026 deadline for administering authorities and pools is a dated step². The report also says the Pension Schemes Bill will introduce a contractual override regime for the contract-based part of the market, permitted only where it is in savers' best interests and certified by an independent expert².

The report states that the implementation of the Value for Money Framework will have its first regulatory assessments expected to take place in 2028, with disclosures beginning to come through from 2028². A ministerial led review, involving the FCA and the Pensions Regulator, will then undertake an assessment commencing in 2029².

What happens next

The Final Report says legislation to implement the reforms will form part of the forthcoming Pension Schemes Bill¹. The report also states that the government will publish a roadmap for the private pensions market "in due course", setting out the broader suite and sequencing of reforms, and that it plans to launch the next phase of the Pensions Review, focusing on the adequacy of pension outcomes, "in the coming months", with reviewers and terms of reference announced in due course².