Most employers have not reviewed workplace pension schemes in the past year, research finds

Less than half of employers have checked their workplace pension schemes in the last year, research from Towergate Employee Benefits found. 

Only 48% said they had reviewed their pension scheme in the past 12 months to see if it offered value for money on charges, default investment and service. 

A further 35% had reviewed it within the last three years, 10% had never reviewed their scheme, and 8% did not know.

Sorangi Shah, client director at Towergate Employee Benefits, said: “New regulations being proposed mean workplace pensions will need to demonstrably offer value for money; we’re surprised at how few employers have recently reviewed their pension scheme, and expect to see this figure increase, but it’s vital that any review encompasses the right criteria.”

Just over half of companies (52%) said they had a pension governance structure in place, like a pension committee, formal governance board or external adviser.

The Government’s new ‘Value for Money’ rules will bring in a standard way to measure workplace pensions across cost, performance and service. 

A red-amber-green (RAG) rating system will be used to show how default investments are performing, with results published to put pressure on underperforming schemes to improve, merge or leave the market. 

The process is due to start in 2026/27, with the first data expected in 2028.

Employers have been told not to wait to review their pension schemes. 

Pension professionals can carry out in-depth analysis, covering charges, automatic enrolment, salary sacrifice, member engagement and education, and retirement support. 

They can then give recommendations to ensure schemes are up-to-date and offer value for both employers and employees.

Shah added: “Pension schemes are not only a statutory obligation but an invaluable part of the employee value proposition. 

“Often pension costs can be a significant proportion of the employee benefits budget, therefore it is important they demonstrate value for money for employers and employees. 

“A well-run pension scheme can be a huge asset to a company in terms of employee satisfaction, engagement and, therefore, recruitment and retention.”