The Pensions Regulator’s Chief Executive, Nausicaa Delfas, used a speech to the JP Morgan Pensions and Savings Symposium to call on the UK pensions market to align behind a shared vision of delivering a sustainable income in retirement and to innovate to improve long-term value and security for savers as the system evolves alongside the Pension Schemes Bill and the work of the Pensions Commission. She highlighted that automatic enrolment has brought more than 22 million people into workplace pensions but that 14.6 million are still under-saving, and linked the government’s reform agenda to a shift towards fewer, larger, well-run schemes that deliver value compared with peers. The priority areas for innovation were defined benefit endgame options (including securing benefits with an insurer, running on to generate surplus to improve benefits or potentially unlock investment for economic growth, and transfers to superfunds for less well-funded schemes), defined contribution investment approaches that move beyond cost-driven decisions using the value for money framework, and clearer default retirement pathways given only one in five savers has a plan for accessing their pension. She also stressed that innovation depends on strong governance, administration and data, with responsible use of artificial intelligence focused on member outcomes, and pointed to revised guidance on financial reserves for DC master trusts aimed at enabling some schemes to reduce cash reserves and meet capital requirements with a more efficient mix of assets. TPR expects to publish an AI action plan in May outlining its approach.

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