Chancellor sets out “Mansion House” reforms

On July 10, 2023, the Chancellor set out in a speech at Mansion House the Government’s intended strategy to boost outcomes for savers and increase funding liquidity for high-growth companies through reforms to the UK’s pension market.

Seeking to make the UK capital markets more attractive, the Chancellor has proposed widespread changes across the pensions system. The measures are intended to enable the financial sector to unlock capital for industries and increase returns for savers, while supporting UK economic growth.

There is also confirmation of a commitment from 9 of the biggest providers in the DC retail and master trust market to earmark 5 per cent of their default fund assets to private equity investments by 2030. 

The measures affecting occupational pension schemes include a multitude of new consultations and calls for evidence on a diverse range of topics: 

• Trustee skills, capabilities and culture.
• Options for DB schemes – looking at surplus, consolidation and a wider role for the PPF.
• Ending the proliferation of small pension pots.
• Helping savers to understand their pension choices. 

All these consultations run until September 5, 2023.

Several responses on previous consultations are also included:

• Value for Money Framework.
• DB consolidation.
• Extending opportunities for collective defined contribution schemes.

Together with a report on Analysing the impact of private pension measures on member outcomes.

These new reforms have the potential to introduce wide-ranging changes particularly for the DC sector. We will look in more detail at these proposals in our next briefing later this month.