Guided Retirement consultation launched by DWP, FCA and TPR

The Department for Work and Pensions (DWP), the Financial Conduct Authority (FCA) and the Pensions Regulator (TPR) launched a joint consultation on Guided Retirement on 3 November 2026, setting out proposals for default pensions under the Pension Schemes Act 2026¹. The consultation runs until 22 December 2026¹. The government also published its response to the policy consultation on Retirement Collective Pension Schemes (RCPS) on the same day, alongside draft regulations to allow providers to offer them as a default pension¹.

The proposals were developed by DWP, HM Treasury, the FCA and TPR¹. Guided Retirement would require pension schemes to provide a default pension for savers approaching retirement, described in the consultation as "a method of taking pension benefits which is presented to an individual as a pre-selected option when they contact their pension provider to access their DC pension pot"¹. The government says around 17 million private sector workers now saving into a pension would be given the option of an income in retirement¹. It also says nine in 10 eligible private sector workers are now saving, up from four in 10 in 2012¹.

The consultation proposes that longevity protection be mandatory for pots above £10,000, after any pension commencement lump sum withdrawals³. It says providers could not set an upper life expectancy or target date at which that protection would expire, and that default pensions could not be designed to require an individual to buy their own annuity, including through annuity brokerages³. The government's analysis suggested that setting the threshold at £30,000 instead would exclude approximately 290,000 additional DC pension pots held by people aged 60 to 65 from mandatory longevity protection⁵. It proposes excluding deferred members with a pot worth £1,000 or less that meets small pot consolidation eligibility rules, and excluding whole life collective money purchase schemes and cash balance schemes³.

The government cites 2025/26 figures showing around 46% of first-time pension pot accesses involved the pot being fully withdrawn¹. It also reports that 77% of DC pension holders yet to access their pension did not have a clear plan for how to do this, that 21% were not aware they had to make a choice, and that 53% say they want a guaranteed income for life³.

The consultation proposes a single point of consent to move into a default pension, with payment made only once the individual has requested it and confirmed bank details³. It also floats a minimum 30-day cooling-off period, and says providers would identify groups of members with shared needs and design defaults for each group, allocating members who do not respond to questions to a suitable pre-designed option using factual information such as age and pot size⁵. Trust-based schemes would document their approach in a Pension Benefits Strategy, with a suggested maximum six-year review period⁵.

Why it matters for households

The proposals concern people with defined contribution workplace pensions, both trust-based and contract-based, including automatic enrolment schemes and workplace personal pensions not used for automatic enrolment³. Savers would keep the freedom to choose other retirement options, including withdrawing or investing their money elsewhere¹. The £10,000 threshold, measured on combined DC savings held with the same provider after any lump sum, determines who would be covered by the mandatory longevity protection requirement⁵. The consultation states that straightforward drawdown alone would not meet the proposed longevity protection requirements, and that providers could use arrangements such as managed drawdown combined with deferred annuities, bulk annuity purchases or retirement-only collective defined contribution pensions⁵.

What happens next

The consultation closes on 22 December 2026¹. The FCA says it intends to consult on draft rules and guidance in the second half of 2027, and DWP plans to consult in parallel on draft regulations for trust-based schemes². On implementation, the consultation proposes that most master trusts and FCA-regulated workplace pension providers comply by summer 2029, with single-employer trusts and common employer group master trusts given until summer 2030, and master trusts using retirement collective pensions as their default also given until summer 2030 to begin providing those benefits⁵. The government says it expects to publish its consultation response alongside a further technical consultation on draft regulations and a consultation on FCA rules, and that this process is expected to take longer than the 12 weeks in its consultation principles³.