New pensions shake-up from Rachel Reeves means 'winners and losers'

Retirees risk a 'triple tax' on pension savings after Rachel Reeves's reforms, it has been warned. Changes to pensions from the Labour Party government could mean "there will be losers", it has been warned, ahead of her speech.

In her Mansion House speech this evening, Ms Reeves is expected to further flesh out her ideas for steering pension funds, as major institutional investors, to invest in certain types of UK assets that the Government sees as key to boosting UK economic growth – as well as retirement outcomes for the UK’s pension savers.

In trying to try unlock up to £80bn in investment in assets like infrastructure and UK growth companies, the Government will introduce legislation that will merge 86 local government pension schemes into a ‘megafund’ that will manage assets worth about £500bn by 2030.

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But there will also be an attempt to encourage the consolidation of private sector workplace schemes. Reeves has told the FT she is targeting a minimum size for multi-employer defined contribution pension schemes of £25bn to £50bn to ‘facilitate their consolidation into megafunds’.

Jon Greer, the head of retirement specialists at, Quilter, share: “Whenever there are changes to pension policy, there will always be winners and losers. The abolition of the lifetime allowance will have saved those who faced charges significant sums, while many who suffered those same charges in previous years effectively ‘lost out’ as they might not have under the current rules."

Kate Smith, a corporate trustee at Aegon, added: “We’re having pensions changed constantly, with big changes introduced every other year. We had pension freedoms in 2015 followed by lifetime allowance changes and then its removal in 2024. There will be a small group of people affected by this – who have been impacted by more than one regime.

"Some savers got lifetime allowance protection but we know from official figures that not everyone did. The Government needs to think about the impact that all these changes have on behaviour.”