DWP pension shake-up will give major finance boost to more than 20 million Brits | Chronicle Live

DWP pension shake-up will give major finance boost to more than 20 million BritsThe Pension Schemes Bill, which was introduced today, is designed to help working people plan for their

retirement by making pensions simpler to understand and manageCommentsRuby Flanagan Money Reporter15:38, 05 Jun 2025Pensioners are set for a shake-up(Image: undefined via Getty Images) The

Department for Work and Pensions (DWP) has announced a new pension overhaul which is set to enhance the retirement savings of over 20 million Britons. Labour's fresh Pension Schemes Bill

aims to assist working individuals in planning their retirement by simplifying pensions and ensuring "driving better value over the long term."

A key component of the bill is the consolidation of small pension pots. The DWP asserts that having numerous small pots can prevent savers from achieving a good return on their retirement

fund due to multiple flat rate charges. The new legislation will amalgamate small pension pots containing £1,000 or less into one for each Briton - currently, there are approximately 13

million pension pots with less than a grand in them.

‌ The Bill also introduces a novel system to display the performance of pension schemes. This will apply to "Defined Contribution" (DC) schemes, which are a type of private pension that you

contribute to regularly, reports the Mirror. The DWP maintains this will aid savers in understanding whether their scheme is providing good value. If it isn't, Brits will have the option to

transfer their savings elsewhere.

‌ The Bill will also mandate schemes to offer "clear default" options to grow pension pots for those nearing retirement. This means individuals will have "clearer, more secure routes to

decide how they use their pension money over time."

Other measures included in the bill: Key figures in the pensions industry such as Phoenix Group, NEST, Now Pensions, and Royal London have expressed support for the new legislation. The

Pensions Regulator and the Pension Protection Fund also greeted the bill with enthusiasm.

Article continues below Work and Pensions Secretary Liz Kendall remarked: "Hardworking people across the UK deserve their pensions to work as hard for them as they have worked to save, and

our reforms will deliver a huge boost to future generations of pensioners. The Bill is about securing better value for savers' pensions and driving long-term investment in British businesses

to boost economic growth in our country.

"As part of our Plan for Change we're helping people find work, stay in work, and ensuring that work pays them back to give them the secure income in retirement they deserve."

Chancellor of the Exchequer Rachel Reeves proclaimed: "The Bill is a game changer, delivering bigger pension pots for savers and driving £50 billion of investment directly into the UK

economy– putting more money into people's pockets through the Plan for Change."

Article continues below Minister for Pensions Torsten Bell contributed: "We are ramping up the pace of pensions reform. Workers deserve to get better bang for each buck saved, and these

sweeping reforms will make sure they do. Pension saving is a long game, but getting this right is urgent so that millions can look forward to a higher income in retirement."