The Association of British Insurers is set to appear before the Public Bill Committee on Tuesday, throwing support behind the government’s Pension Schemes Bill.
The Committee has been gathering views on how the legislation can simplify pensions, improve value, and better serve millions of savers.
ABI says the Bill gets a lot right. It welcomes powers that allow firms to consolidate schemes where it benefits customers, a framework for judging Value for Money, and moves to address the persistent problem of small pension pots.
Together with the Pensions Commission and wider reforms, the trade body sees it as part of a long-term roadmap for the system.
Still, it pressed MPs on four sticking points.
First, it argued that pension providers must retain control over investment decisions.
With the Mansion House Accord already signed by 17 of the UK’s largest funds and data showing 65% of annuity assets invested domestically, ABI believes mandating investments would erode trust.
Government’s role, it said, should be about making the UK attractive for investment, not forcing allocations.
Second, ABI flagged risks around Superfunds.
These vehicles offer a cheaper route for schemes that cannot afford a full insurance buyout, but they hold less capital and face lighter regulation.
ABI wants strict rules that mirror those for insurers and a strong “Gateway test” to ensure schemes that can afford a buyout go down that path.
It also warned against allowing companies to extract surplus capital in ways that undermine member security.
Third, it called for a clearer timeline.
ABI argued that powers like contractual overrides—which would let FCA-regulated workplace schemes transfer savers to better-value plans—should come before the Value for Money framework and small-pot consolidation reforms. Without sequencing, firms risk being unable to shift savers into stronger schemes.
Fourth, ABI pushed for better communication rules.
Under current law, workers automatically enrolled in workplace pensions are cut off from marketing communications.
ABI says extending the “soft opt-in” exemption to pensions would let providers share useful content, helping people engage more deeply with their savings and make sharper decisions.
Rob Yuille, ABI’s head of long-term savings policy, summed it up plainly: the Bill could reshape the UK pension system if done right.
“It’s an exciting time for pensions and there is much to celebrate in the government’s Pension Schemes Bill. But it does also need careful scrutiny”.
With the right approach, this Bill alongside the reformed Pensions Commission, adequacy review, and upcoming regulatory changes could fundamentally strengthen the UK’s pension system.
Rob Yuille, ABI’s head of long-term savings policy
“We’ll continue to lead on behalf of the sector to ensure savers’ interests remain at the heart of reform”, he said, while stressing the need for careful scrutiny and a steady focus on savers’ interests.
