The Pensions Minister, Laura Trott, has announced a raft of new defined contribution (DC) measures in an effort to close the pensions inequality gap, aiming to create "fairer, more predictable, and better-run pensions”.

The measures include plans to extend collective defined contribution (CDC) to multi-employer schemes, a call for evidence on small pots solutions, as well as a consultation on proposals for a new value for money (VFM) framework.

The framework was developed in partnership with The Pensions Regulator (TPR) and the Financial Conduct Authority (FCA) and sets out how schemes will be expected to provide savers with better value from their investments and a quality level of service.

The proposals announced today are expected to help address the pension inequality gap, which the DWP said has risen since the decline of defined benefit (DB) and the emergence of DC.

Announcing the reforms, Trott stated: “There is a pension inequality gap between those who had secure retirements thanks to DB, to much more uncertainty now. Since 2012, automatic enrolment has transformed the pensions landscape in the UK for the better, but we know there’s more to be done to ensure a fairer future for savers.

“Being in an underperforming pension scheme can lead to someone missing out on thousands of pounds. The VFM framework and our new measures will improve security and create better returns for savers, so they can enjoy the retirement they’ve worked so hard for.”

Adding to this, TPR executive director of regulatory policy, analysis and advice, David Fairs, stated: “Ensuring every pound that savers put into their DC pension pot delivers value for money is vital to help people achieve the best possible retirement.

"The measures announced as part of this far-reaching reforms package deliver on our commitment to put savers at the heart of all we do.”

“Our joint VFM framework will drive greater transparency and standardisation of reporting across the DC pensions market, allowing trustees to make more informed decisions and improve long term outcomes for savers. I urge the industry to take part in these important consultations.”

FCA executive director of markets, Sarah Pritchard, added: “Pensions are complex, and savers need to be able trust that their providers have the information they need to make the right choices. These proposals will help ensure that they take a wide ranging and long-term view – value for money is not just about costs and charges.”

“We will continue to work with government, other regulators, and industry to deliver long term value and support savers in their retirement.”

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