It is the final week of January, and several important updates have emerged from the government.

The most significant announcement is the government's plan to lift restrictions on how well-funded occupational defined benefit (DB) pension schemes can invest their surplus funds.

The government will set out the details of the surplus policy in its response to last year's consultation on options for DB pensions, which is expected this spring.

In reaction to the news, industry experts welcomed the government's plans but stressed the need for the government to ensure that the right guardrails are in place.

In addition to the announcement on lifting restrictions on DB surplus investment, Chancellor, Rachel Reeves, said the government was on track to share the final Pensions Investment Review report in spring.

It was also a noteworthy week in pensions as the Pension Protection Fund announced that it had more than halved the levy estimate for 2025/26 to £45m, which was broadly welcomed by the pensions industry as a "great stride in the right direction."

In other big news this week, the Bank of England announced that applications are open for the Contingent Non-Bank Financial Institution Repo Facility, which will lend to pension schemes in times of severe gilt market dysfunction to help maintain financial stability.

There has also been movement regarding the findings of the Parliamentary and Health Service Ombudsman’s report on women’s historic state pension changes this week, with MPs voting in favour of bringing in a bill requiring the government to address the report.

Additionally, this week saw Secretary of State for Work and Pensions, Liz Kendall, confirm that the Department for Work and Pensions is working with The Pensions Regulator to gather information on the number of schemes providing discretionary increases on pre-1997 benefits.

There were also several pieces of research released this week that provided important insights into pension adequacy, with Standard Life finding that almost one in 10 (9 per cent) retirees aged over 55 have unretired or are actively looking for work, due to financial pressures, a lack of pension provision, or a desire for social connection.

In addition to this, Just Group found that the gap between the best and worst-paying annuities has “spiked” in recent weeks, reflecting the rise in bond yields.

Meanwhile, figures from the Office for National Statistics revealed that the number of people over state pension age (SPA) is projected to rise by 13.8 per cent, from 12 million in 2022 to 13.7 million in 2032, despite the increase in the SPA to 67 from 2028.

Hargreaves Lansdown’s savings and resilience barometer pointed out that only 39 per cent of the highest earners are on track for a comfortable retirement income.

In addition to this, a Society of Pension Professionals poll suggested that member option exercises are "here to stay".

In other news, industry experts predicted further innovation and development in the pension risk transfer market in 2025, due to a “high demand” from pension schemes.

This week also saw movement in the bulk annuity market with the Colthrop Board Mill Pension Scheme completing a £23m buy-in with Aviva and the Sanofi Pension Scheme having completed a £1.4bn buy-in with Legal & General Assurance Society Limited.

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