Aegon UK urges FCA to delay new DC pension consolidation rules until 2030 

Aegon UK has called on the Financial Conduct Authority (FCA) to delay plans for new rules on non-advised defined contribution (DC) pension consolidation until 2030. 

In its response to the FCA consultation CP25/39, Aegon UK said the proposed changes should wait until wider Government pension consolidation work is rolled out.

Steven Cameron, pensions director at Aegon, said: “The FCA is proposing a major change to the process around consolidating defined contribution contract-based pensions. 

“We support the policy intent of ensuring members are protected from losing out, but with so many other major changes underway across the pensions market, now is just not the right time for the proposed changes.

“Pensions consolidation into modern pensions can be very good for individuals – making it easier for people to manage their pension, supporting better engagement, simplifying investment and ‘at retirement’ decisions, and often leading to lower charges.”

Cameron added: “But the proposals could inadvertently discourage some from consolidating just when the Government is pushing for widespread scheme and small pot consolidation, partly to benefit the UK economy.

“For some pensions, consolidation is not in the individual’s interest, particularly if they’d lose valuable benefits. 

“The consultation paper refers briefly to ‘trace and consolidate’ solutions but doesn’t factor in how using such tools can support customers.”