Pensions Weekly Update – 26 November 2025

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Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes that you might have missed, with links for further information.

The Chancellor has delivered her second Autumn Budget speech. Despite widespread speculation, the Budget contained limited pensions-related measures. The highlights were:
- There will be no change to the tax-free lump sum.
- Salary sacrifice is forecast to treble in cost to £8 billion by 2030. A £2,000 cap on salary sacrificed pension contributions will be introduced. Contributions above this level will be taxed in the same way as other employee contributions (i.e. national insurance contributions will be payable by the employee and the employer.) This measure will be effective from April 2029. Employers will need to report the total amount sacrificed through their existing payroll software. HMRC will engage with stakeholders on this and publish further guidance on it.
- The government will introduce CPI-linked increases, capped at 2.5% a year, on pre-1997 pension accruals for members of the Pension Protection Fund and Financial Assistance Scheme where their original schemes provided this benefit, from January 2027.
- Measures will be put in place from April 2027 to allow well-funded defined benefit pension schemes to pay surplus funds directly to scheme members over the normal minimum pension age, where scheme rules and trustees permit it, with a reduced tax charge on such payments.
- There will be no increase in national insurance contributions.
- Income tax thresholds will be frozen for a further three years from 2028.
- The government will transfer the investment reserve fund of the British Coal Staff Superannuation Fund to its members. This will be paid out as an additional pension to members of the scheme.
- The triple lock will remain. The government says that it will ease the administrative burden for pensioners whose sole income is the basic or new state pension without any increments so that they do not have to pay small amounts of tax via simple assessment from 2027-28 if the new or basic state pension exceeds the personal allowance from that point.
- The government has published an update on its Green Financing Programme.
More detail will no doubt follow in due course. In the meantime, the government has also published background papers to the Autumn Budget.
The Pensions Regulator (TPR) has published a market oversight report on data quality following a regulatory initiative involving schemes of all sizes. The report states: “managing data quality is not a one-off exercise. We urge trustees to build on the momentum created by dashboards, and to treat member data as the strategic asset it is”. Alongside this report, TPR has updated its scheme member data quality guidance (previously known as “record keeping”). This consolidates all of TPR’s data-related guidance and contains clear expectations and best practice examples. The Pensions Administration Standards Association (PASA) has published two new pieces of data guidance to assist trustees with compliance.
The Pension Schemes Bill is scheduled to have its third reading in the House of Commons on 3 December, when the public bill committee will be reporting back to the House of Commons on the amendments made to the bill during its review. Many more amendments have since been proposed to the bill, which the House of Commons will consider. The House of Commons library has published a background briefing research paper on the progress of the bill to date.
Companies House has published guidance on its approach to non-compliance with the new identity verification requirements that came into force on 18 November for directors and persons with significant control of UK registered companies. Ultimate sanctions include prosecution, financial penalties and/or being reported to the Insolvency Service. Trustee directors should take action now to verify their identity in readiness for their trustee company’s next confirmation statement. If you need assistance with this, please ask your usual firm contact.
The Ministry of Housing, Communities and Local Government has published a technical consultation on two draft sets of regulations intended to implement policy proposals outlined in the government’s response to its Fit for the Future consultation in relation to the Local Government Pension Scheme (LGPS). The government says that “these reforms will fully consolidate the scheme into asset pools and introduce minimum operating standards for asset pool companies, strengthen the governance of Administering Authorities and pools and boost LGPS investment in their localities and regions”. Consultation closes at 11:59 p.m. on 2 January 2026.
You can now watch our Labour & Employment webinar on settlement agreements, which took place on 12 November 2025.