Written by Chris Eastwood, Co-Founder and CEO of Penfold
The government’s new Pension Schemes Bill has sparked headlines, and no shortage of confusion, among advisers and providers alike. Chris Eastwood, Co-Founder and CEO of digital pension provider Penfold, welcomes the Bill’s ambition to raise standards and improve outcomes for savers. But in this exclusive article for IFA Magazine, he argues that focusing solely on scale risks missing the point. Reform must also support innovation, accessibility and trust, especially for younger, mobile savers.
The UK pension system is under pressure. Millions are under-saving, few understand their options, and many workplace schemes still fall short of delivering the outcomes savers deserve. In that context, the government’s proposed Pension Schemes Bill is a welcome intervention.
The ambition behind the bill is the right one: raise standards, drive scale, and improve long-term outcomes for savers. But since its publication, there’s been confusion – and, in some cases, alarmist headlines – about what it really means for providers like Penfold.
Let’s set the record straight. The draft legislation proposes that workplace schemes must include a default arrangement with at least £25 billion in assets under management by 2030. But that requirement applies to the investment fund, not the provider. Critically, the legislation allows multiple schemes to use a shared default strategy to meet the threshold – a model that already exists in the market today.
That means smaller, tech-enabled providers like Penfold are not at risk of being shut down. In fact, we’re well-positioned to adapt. We’re exploring all compliant options, including joining a shared large-scale default arrangement. At the same time, we’re continuing to grow our own flagship fund, powered by rapid customer growth and a scalable, digital-first platform.
But scale alone won’t fix the pensions system. Real value comes from strong long-term returns, an intuitive saver experience, and the kind of trust and transparency that drive long-term engagement. If reforms focus purely on size, we risk stifling innovation, weakening competition, and overlooking what really matters to modern savers – especially younger, mobile workers.
The bill offers a once-in-a-generation chance to build not just bigger schemes, but better ones. That means supporting providers that improve access, clarity and confidence – and ensuring innovation isn’t left behind in the rush to consolidate.
As the sector evolves, we mustn’t lose sight of the bigger picture: encouraging more people to save for retirement in the first place. That means supporting innovation, improving user experience, and ensuring that modern, accessible schemes have the room to thrive.
Pension reform must be about more than just numbers on a balance sheet. It should be about building a system that genuinely helps everyone save enough to be comfortable in later life.
