'Startlingly low' Budget forecasts on surplus release show need to 'think bigger'

Insight Investment says DB surplus release policy could achieve ‘much more’

Jonathan Stapleton
clock • 1 min read
Jos Vermeulen: It's time to think bigger
Image:

Jos Vermeulen: It's time to think bigger

Government policy to unlock surpluses in defined benefit (DB) pension schemes could achieve “much more”, Insight Investment says.

The asset management firm said HM Treasury's Budget forecasts, published yesterday (26 November), showed the UK was "overlooking a major chance to boost growth, support businesses and millions of people and generate significant tax revenues" as well as to strengthen long-term gilt market stability.

It said that, while there was an estimated £200bn sitting in DB surpluses, HM Treasury only expected taxes of around £500m from surplus release over the next five years – a number it said was "startlingly low" in comparison to a potential tax take of £50bn.

Insight Investment head of solution design Jos Vermeulen said: "There has been progress – the decision to permit cash payments to pensioners and grant pre-1997 indexation in the Pension Protection Fund (PPF) are positive steps.

"But the fix that would truly unlock this opportunity is simple: increase PPF protection to 100% for DB schemes that follow regulatory investment guidelines. This would give trustees complete confidence that members' pensions are secure – even in a worst-case scenario."

He added: "With these recent changes, the step to full PPF protection is even smaller, and the costs and risks would be far outweighed by the benefits. It's time to think bigger."

More on Investment

UK gilt yields spike as Middle East conflict weighs on fiscal outlook

UK gilt yields spike as Middle East conflict weighs on fiscal outlook

UK 10-Year gilt nears 4.6%

Linus Uhlig
clock 11 March 2026 • 2 min read
Partner Insight: Climate and credit – if it's easy, you're not doing it right

Partner Insight: Climate and credit – if it's easy, you're not doing it right

Martin Foden, Head of Credit Research and Luca Giacalone, Senior ESG Credit Analyst, discuss the challenges of integrating climate conviction within credit portfolios and how in-house analysis and collaboration are key.

Martin Foden and Luca Giacalone @ Royal London Asset Management
clock 05 March 2026 • 1 min read
Planned issuance of long-dated and index-linked gilts falls as DB demand drops

Planned issuance of long-dated and index-linked gilts falls as DB demand drops

Reduction in average maturity of issuance as scheme demand for longer maturities reduces

Jonathan Stapleton
clock 03 March 2026 • 2 min read
Trustpilot