PIMFA
Pensions
For most people, their pension represents the largest source of wealth that they will accumulate over their lives. In accumulation and decumulation the wealth management, financial advice and planning industry provides a reassuringly regulated and professional service that puts the customer at the heart of everything they do.
This has become increasingly complex for firms over the preceding decade as they have sought to navigate a changing regulatory environment. Despite substantive reforms such as the introduction of automatic enrolment, pension freedoms, changes to pension transfer advice and more, pensions continue to be a subject of reform from Regulators and the Government. Over the coming years we believe that we see more consolidation of pension schemes, further drive towards value for money, and a drive to focus the way in which and where these schemes invest. Where these reforms directly impact PIMFA firms, we will engage on your behalf to secure change in your interests.
- FCA Retirement Income Market Data 2024/25
The FCA has published retirement income market data for 2024-2025, with key findings set out:
- Total number of pension plans accessed for the first time in 2024/25 increased by 8.6% to 961,575 compared to 2023/24 (885,455).
- Sales of drawdown policies saw the biggest increase from 278,977 in 2023/24 to 349,992 in 2024/25 (25.5%).
- Sales of annuities increased by 7.8% from 82,061 in 2023/24 to 88,430 in 2024/25.
- The overall value of money being withdrawn from pension pots increased to £70,876m in 2024/25 from £52,152m in 2023/24. This is an increase of 35.9%.
- 30.6% of pension plans accessed for the first time in 2024/25 were accessed by plan holders who took regulated advice (down from 30.9% in 2023/24).
- The number of DB to DC transfers continued to fall from 7,181 in 2023/24 to 6,418 in 2024/25.
Access the publication here.
- Our Latest work
FCA DP24/3: Pensions: Adapting our requirements for a changing market
PIMFA Responds to FCA DP24/3: Pensions: Adapting our requirements for a changing market
Read the response here
This guide provides a review of the FCA policy statement on pension transfer advice.
Latest News
Guided Retirement: Policy Consultation
DWP and FCA have jointly published a consultation which seeks to take forward provisions set out in the Pensions Schemes Act 2026 on Guided Retirement. These proposals would require workplace DC pension schemes to give savers a ready-made ‘default pension’ when they come to take their money.
As currently conceived, there would be a number of features which would be required to be included within Guided Retirement products namely:
- Longevity protection:
- Providers can’t build in an end date or upper age at which protection stops.
- Defaults can’t rely on the saver buying their own annuity, including through a broker. The government’s view is that plain drawdown alone won’t provide the required protection.
- The requirement applies above a proposed £10,000 threshold (net of tax-free cash), measured across all of a person’s DC pots with the same provider. Some in industry suggested £30,000, but DWP estimates that would exclude roughly 290,000 more pots held by 60–65-year-olds.
- Single point of consent: The saver agrees once, when they ask for payment. Providers can’t require fresh consent to move into later phases, such as a “flex then fix” switch to an annuity. They must, however, use best endeavours to contact the person before any irreversible element starts.
- Cooling-off: a minimum 30-day cooling-off period is proposed, with views sought on whether it should be longer.
- Pre-set parameters: Providers must set and explain limits such as how much flexibility there is, whether extra withdrawals are allowed, and whether there’s a discretionary spending pot. They can cap withdrawals above the set rate, much as DB scheme rules do.
The vast majority of PIMFA members will not be in scope of these proposals given that you do not offer workplace schemes. However, there will be some interaction with existing suitability rules as currently conceived. PIMFA intends to respond to this consultation but currently does not have an established view on what its position should be in response.
Retirement is no longer a moment, and neither is the advice opportunity
Pensions Dashboards Programme Blog: Reporting Standards Update: What This Means For You
The Pensions Dashboards Programme (PDP) has published a blog on its updated draft of the reporting standards (version 2.3) for pension providers and schemes connected to the pensions dashboards ecosystem.
This version outlines detailed technical requirements for reporting data to the Money and Pensions Service daily via the application programming interface.
Once approved, the draft will become the new legally binding version of the reporting standards, replacing version 2.0, with a coming-into-force date of 1 March 2027.
For information on what firms should be doing now to prepare read the blog here