Defined benefit (DB) pension transfer values hit a record high of £270,000 at the end of November, according to XPS Pension Group’s Transfer Value Index.

The increase was attributed to further forecast increases inflation and a slight reduction in gilt yields, and saw values pass the recent record high of £265,200 seen on 28 October.

However, despite the higher values on offer, the index showed that transfer activity has remained "steady", with an annualised rate of 59 members out of every 10,000 transferring their pension.

XPS Pensions Group partner, Mark Barlow, commented: “Increasing inflation expectations are continuing to drive ever-higher transfer values.

“However, this doesn’t seem to be translating into increased activity, which has remained consistently lower than pre-pandemic levels perhaps due to difficulties in obtaining suitable financial advice or individuals steering clear of making significant financial decisions in the current environment.”

XPS's Red Flag Index also increased over the past month, rising from 47 per cent in October to 50 per cent in November, meaning that half of prospective transfers showed one or more warning signs of a potential scam or likelihood of poor member outcomes.

In light of this, XPS Pensions Group member engagement hub client lead, Helen Cavanagh, suggested that the introduction of new anti-scam regulations will result in "many members losing their statutory right to a transfer or having to take scams guidance prior to a transfer".

"Trustees will need to have a robust process in place to implement these regulations appropriately," she said.

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