DWP announce new pension rules that could boost savings for millions of people

Millions are set to benefit from the reforms set out by the DWP today

The Department for Work and Pensions (DWP) has announced a set of new pension rules that could see millions of people save money on their retirement funds. Millions of local government workers will benefit from the reforms to the Local Government Pension Scheme (LGPS) after new legislation was laid today, 21 May.

Regulations set to come into force next month will introduce new requirements for how pension funds are managed and invested for frontline council workers. These changes finalise the rules, so that pension funds can work together, invest more in local communities, and ensure people’s retirement savings are properly looked after, according to the DWP.

Click here to get the biggest stories straight to your inbox in our Daily Newsletter

The secondary legislation laid today, which will come into force on June 30, will ensure every pound saved delivers stronger returns while supporting investment in the economy.

Minister for Local Government and Homelessness, Alison McGovern said: “Those working on the front line in our local communities are unsung heroes, and they deserve a pension scheme that works as hard as they do.

“These reforms will do exactly that – providing better returns, putting money back into local communities, and driving economic growth that people can actually feel.”

Minister for Pensions, Torsten Bell, said: “The reforms are a major milestone that will release the untapped potential of the local government pension scheme, ensuring its £400 billion of assets are managed effectively on behalf of members and driving economic growth across the country.”

Since 2015, LGPS funds have made strong progress on pooling – where pension funds combine their assets to make larger, more effective investments, according to the Government. Already, 80% of assets are pooled, achieving £870 million in savings.

The new regulations build on this by making pooling a legal requirement for the first time, ensuring every fund meets the same high standards.