What You Need to Know about the Pension Schemes Bill

The UK’s 2025 Pension Schemes Bill introduces some of the most significant reforms in recent years- reshaping how pension schemes manage assets, members, and future obligations.

Here’s a clear, concise summary of what’s changing and why it matters:

1. Consolidation of Small Pots

• Auto-merging: Pension pots under £1,000 will be automatically consolidated.
• Why it matters: With an estimated 3.3 million lost or inactive pots, this reform aims to reduce fragmentation and improve outcomes for savers.
  

2. Value-for-Money Enforcement

• Mandatory scrutiny: Schemes rated as not delivering value must either improve or wind up.
  
• Why it matters: Trustees and providers will face growing pressure to prove their costs, governance, and returns are aligned with member interests.
  

3. Defined Benefit (DB) Surplus Unlocking

• New flexibilities: Trustees may return surplus assets to employers or members, even without pre-existing resolutions.
  
• Why it matters: While early estimates suggest modest near-term gains (~£8.4B over 10 years), the reform opens the door to long-term changes in how DB schemes manage surplus.
  

4. Superfund Governance and Consolidators

• Formal framework: The bill defines DB superfunds in law and introduces rules around authorisation, inspections, and penalties.
  
• Why it matters: With the Regulator now actively supporting “run-on” as a viable model, superfunds- and consolidators more broadly- will face tighter data and governance expectations, especially when onboarding legacy member records.
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5. Guided Retirement Options

• Default pathways: By 2027–2028, schemes must offer drawdown and annuity options through master trusts or DC vehicles.
  
• Why it matters: Personalisation is no longer optional. Member profiling- including marital status, dependents, and location- will be critical to designing appropriate pathways.
  
  

The Bottom Line

Whether you’re a trustee, administrator, consolidator, or adviser, one message comes through clearly: The regulatory bar is rising- and data standards must rise with it.

Incomplete or outdated records can delay decisions, block transfers, and create compliance risks at precisely the moment the industry is being asked to move faster and do more.

How Heka Can Help

Heka provides web intelligence to help pension schemes complete their member records — from global contact tracing to verifying life events and eligibility. We’re already working with leading administrators and governance providers to support consolidation, de-risking, and dashboard readiness. If you’re preparing for what’s next, let’s talk.

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👉 Download the full Pension Schemes Bill here.