- 15/04/2026
- Posted by: Valerie Vaz MP
- Category: News
On Wednesday 15 April 2026, the Pensions Scheme Bill returned to the Commons as amended by the Lords. As the Pensions Minister noted, this is a complex piece of legislation with one simple goal: higher returns for pension savers. The Government made a number of technical changes in the House of Lords to ensure the Bill operates as intended, alongside more substantive amendments. These include measures to ensure that superfunds are not required to wind up where they continue to provide a high level of security, and provisions to introduce value-for-money reforms through regulations, allowing for more precise design and consultation.
The House considered a range of Lords amendments, including those relating to the Local Government Pension Scheme. I agree with Ministers that legislative change is not the most appropriate way to achieve their aims in this instance. I welcome the strong consensus on the need to act on small pension pots. One proposal to extend the dormancy period for automatic consolidation from 12 to 36 months would leave savers facing multiple charges for longer and could generate losses of up to £50 million per year.
On asset allocation, the evidence is clear that better outcomes for savers require greater investment diversification. While the industry is making progress, competitive pressures can drive a narrow focus on minimising headline costs rather than maximising returns. The reserve power is intended to address this. That is why I opposed Lords amendments to remove it. It is also why the Government introduced amendments in lieu to make clear that the power can only be used to support the industry’s view of what is in savers’ interests. The reserve power will also remain entirely neutral between asset classes, ensuring it is tightly focused on savers’ interests and cannot be misused.
There were 8 votes:
The House considered a range of Lords amendments, including those relating to the Local Government Pension Scheme. I agree with Ministers that legislative change is not the most appropriate way to achieve their aims in this instance. I welcome the strong consensus on the need to act on small pension pots. One proposal to extend the dormancy period for automatic consolidation from 12 to 36 months would leave savers facing multiple charges for longer and could generate losses of up to £50 million per year.
On asset allocation, the evidence is clear that better outcomes for savers require greater investment diversification. While the industry is making progress, competitive pressures can drive a narrow focus on minimising headline costs rather than maximising returns. The reserve power is intended to address this. That is why I opposed Lords amendments to remove it. It is also why the Government introduced amendments in lieu to make clear that the power can only be used to support the industry’s view of what is in savers’ interests. The reserve power will also remain entirely neutral between asset classes, ensuring it is tightly focused on savers’ interests and cannot be misused.
There were 8 votes:
motion to disagree with Lords Amendment 1 Ayes 278, Noes 158
motion to disagree with Lords Amendment 5 Ayes 269, Noes 103
motion to disagree with Lords Amendment 35 Ayes 275, Noes 159
With these changes, the Pension Schemes Bill will build a resilient, efficient and fair pension system to deliver both for savers and the economy as a whole. It will now return to the House of Lords.