'Strong case' for automatic consolidation of small pensions, IFS argues

Think tank calls on the government to ‘end and reverse’ the proliferation of small pots

Holly Roach
clock • 4 min read

There is a “strong case” for deferred small pension pots to be consolidated by default, the Institute for Fiscal Studies (IFS) has argued.

In the think tank's report, published today (12 February), the IFS highlights in 2023 there were around 20 million defined contribution (DC) pension pots worth less than £10,000 – containing £30bn in total – with 12.1 million of these worth less than £1,000 which were no longer being contributed into. As such, the IFS has called on the government to "stop and reverse" the proliferation of millions of small pension pots in the UK as they have become "burdensome" and "uneconomical" for both pension providers and savers. The IFS argued there is a "strong case" for small pots to be automa...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Pension IHT: A minor win for executors, a missed opportunity for HMRC

Pension IHT: A minor win for executors, a missed opportunity for HMRC

'It's a great pity HMRC couldn't have been a bit braver and taken the sensible approach'

Rachel Vahey
clock 09 December 2025 • 3 min read
Salary sacrifice change to 'hit' more than three million workers

Salary sacrifice change to 'hit' more than three million workers

Government releases impact assessment

Jen Frost
clock 05 December 2025 • 3 min read
Andrew Tully: Plummeting pensions confidence is 'siren call' for wide-reaching action

Andrew Tully: Plummeting pensions confidence is 'siren call' for wide-reaching action

'We're seeing a deep erosion of trust in the retirement system'

Andrew Tully
clock 05 December 2025 • 3 min read