The new Pensions Commission carries challenge, importance and opportunity. It also builds on the great work already undertaken into the health of today’s system – such as the Pension Policy Institute’s recent Pension Framework report. Let’s stand on these shoulders and reach high.
More than 7,000 days after the Turner Review published its final paper, on 4 April 2006, the government announced, on 21 July, that it will “revive” the Pensions Commission.
Much has happened inside our pensions world in the intervening years. For example, private pension participation has risen to a record high, a new state pension has been born and the old rules that governed our options at retirement have been torn up.
Beyond our little world, all else has been far from calm. For example, we’ve navigated a global financial crisis, we’ve experienced a global pandemic and we’ve seen our sense of uncertainty accelerate. Given all of the above, now feels like a good time to look again at our system.
The new commission looks to be in good hands. It has a broad remit and it stands on a mountain of insight and evidence
Turner’s work will be a hard act to follow. It has been hailed as “the gold standard of policy reviews”, balancing technical excellence with political skill, and the environment in which the new commission advances probably carries greater economic and political challenge than that enjoyed before.
Working to its advantage, however, the new commission looks to be in good hands. It has a broad remit, to consider “the long-term challenges of supporting an ageing population” and it stands on a mountain of insight and evidence.
A helpful eleventh-hour addition to the new commission’s reading list came from the brilliant Pensions Policy Institute (PPI) and its Pensions Framework report. Published just nine days before the new commission was born, this study examines the health of the UK pension system through the widest possible lens.
First launched in 2021, the PPI’s Pension Framework takes an objective look at 41 indicators under the themes of adequacy, fairness and sustainability. Rather neatly, these are the three themes the new commission will also seek to explore.
Alistair McQueen: Choosing the correct resolution
Reflecting the reach of the pension system, the PPI’s 41 indicators range from those close to home – such as the coverage of the state pension and levels of private contributions – to those of the wider economy and of neighbouring policy areas – such as labour market activity and levels of home ownership.
The pension system does not operate on an island. It influences and is influenced by elements far beyond its own borders. Therefore, a big scope and intellectual rigour rightly frames the work of the new commission.
The PPI’s framework tells us that the sustainability of the current pension system has been advanced but that its adequacy and fairness are more challenging. This is also recognised in the early positioning of the new commission.
Through the lens of adequacy, few now argue, for example, that auto-enrolment’s 8% minimum is sufficient, nor that a system that may be helping the employed is equally helping the self-employed.
The PPI’s 2025 report saw the first holistic refresh of its framework since it was launched in 2021. Despite all our pensions talk of recent years, the main insight was that little had advanced. There is still much to do on adequacy and fairness.
The pension system does not operate on an island. It influences and is influenced by elements far beyond its own borders
From a cup-half-empty perspective, this could be used as evidence to beat all of us who strive to deliver better outcomes. From a cup-half-full perspective, holding ground could be seen as an achievement given the volatility of recent years.
Whether our cup is half-full or half-empty, however, is a secondary debate. What cannot be denied is that we all have more work to do.
The challenges facing the new commission are probably greater that those that went before, and the importance of its conclusions is arguably greater too. The intersection of challenge and importance is opportunity, and the new Pension Commission presents an opportunity to translate our many words into positive action.
For the good of those we serve, let’s seize this opportunity.
Alistair McQueen is head of savings & retirement at Aviva
