Pensions Bulletin 2025/12

Chancellor’s Spring Statement says little about pensions

Rachel Reeves MP, the Chancellor, delivered her Spring Statement just after 12.30pm on Wednesday 26 March, and spoke for about half an hour. Her general theme was that the world and the global economy have become more “uncertain” but that her self-imposed fiscal rules remain “non-negotiable” and that the Government remains committed to just one major fiscal event a year.

As a result, the Chancellor said that the Statement “does not contain any further tax increases” and, as had been expected, there was little said directly about pensions, apart from one line about “increasing investment with reforms to our pension system”.

However, references in the speech to the new National Wealth Fund, infrastructure and technology investment as well as planning reforms may all open up new and wider opportunities for pension schemes to invest in for the long-term benefit of savers.

The policy paper also says that the Government is “looking at options for reforms to Individual Savings Accounts that get the balance right between cash and equities to earn better returns for savers, boost the culture of retail investment, and support the growth mission” and refers to the FCA’s proposals for a “targeted support” regime (see Pensions Bulletin 2024/49).

On a macro-economic scale, the Chancellor stated that the actions she has taken today will mean that the Government’s two main “fiscal rules” (ie to ensure that public spending is under control by balancing the budget by 2029/30; and to drive growth in the economy ensuring that net financial debt falls by 2029/30) will still be met two years early.

The Chancellor also announced that she intends to increase capital spending by a further £2bn per year (compared to the autumn) to drive growth in the economy

Additionally, the Chancellor expects that UK inflation will hit its 2% target by 2027 and she noted that she is “not satisfied” that the Office for Budget Responsibility has downgraded its growth forecast for 2025 from 2% to 1%.

To raise further revenue, the Chancellor announce a further crackdown by HMRC on tax avoidance and the accompanying papers announced the launch of two consultations linked to this covering non-compliance facilitated by tax advisers and promoters of tax avoidance schemes.

FCA launches five-year strategy to support growth

The FCA has launched a new five-year strategy “to deepen trust, rebalance risk, support growth and improve lives” by focussing on four priorities which will enable it to:

• Be a smarter regulator
• Support sustained economic growth
• Help consumers navigate their financial lives
• Fight financial crime

As far as pensions are concerned, the strategy refers to driving “better value for money in workplace pensions, changing regulation to encourage schemes to invest for longer-term returns, boosting people’s nest eggs and economic growth.” (the first part of this is clearly referencing the forthcoming VFM framework – see Pensions Bulletin 2024/31.)

The strategy also refers to the proposed “targeted support” regime to sit between regulated and non-regulated advice, high level proposals around which were consulted on in December 2024 (see Pensions Bulletin 2024/49) and about which a further consultation is expected in the next few months covering how to implement it

House of Lords launches inquiry into preparing for an ageing society

The Economic Affairs Committee of the House of Lords is launching an inquiry to investigate the impact of ageing on the UK economy, the opportunities and challenges the Government needs to consider given the demographic trends, the policies necessary to adapt to this future and the broader behavioural changes that may be required.

The Committee is asking several questions including, for example, what changes to the workforce are needed to support an ageing population, what incentives regarding workforce participation by older individuals are created by the various existing tax and pension arrangements, and what are the issues relating to intergenerational fairness and the transfer of assets between generations?

The deadline for written evidence to the Committee is Monday 28 April

Royal Assent for the Finance Bill

The Finance Bill that followed on from the Autumn Budget received Royal Assent on 20 March 2025. The now Finance Act 2025 has only three sections relevant to pension provision (sections 32-34) and they are unchanged from when we reported on them in November 2024 (see Pensions Bulletin 2024/44).

FRC publishes three-year plan

The Financial Reporting Council has published its Strategy for 2025-28 and its Annual Business Plan and Budget for 2025-26. The FRC says that its refreshed strategy makes it clear that it is “dedicated to serving the public interest while actively supporting UK economic growth through smart, targeted and proportionate regulation”. On the Audit Reform and Corporate Governance Bill promised in the King’s Speech (see Pensions Bulletin 2024/27), the FRC says that it will work with the Department for Business and Trade as they bring forward draft legislation for pre-legislative scrutiny. The FRC says that its strategy has been developed to remain relevant regardless of the timing of legislation.

PDP blogs on connecting to the dashboard

The Pensions Dashboards Programme has published a blog reminding everyone what the first cohort of pension providers and schemes need to do to connect to the pensions dashboards ecosystem by their 30 April 2025 deadline. These include confirming the 'connect by' date, confirming the route to connection, preparing data and deciding the data matching approach. It followed this up with a further blog providing an overview of the process involved in connecting to the ecosystem via a third party. This overview comprises when to connect by, confirming the connection date, registration codes and completing connection.