'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

A pensions manifesto for the new prime minister

A pensions manifesto for the new prime minister

Baroness Ros Altmann says pension funds could be a 'silver bullet' to revive UK growth

Baroness Ros Altmann
clock 24 June 2026 • 6 min read
Rise in custom indices to continue as funds become more explicit with ESG preferences

Rise in custom indices to continue as funds become more explicit with ESG preferences

Jonathan Stapleton speaks to Robeco’s Joop Huij about the growing shift to bespoke

Jonathan Stapleton
clock 23 June 2026 • 3 min read
Partner Insight: Investing in a ruptured world requires compensation for risk

Partner Insight: Investing in a ruptured world requires compensation for risk

A global economic outlook for fractured alliances, fiscal strain, and massive-scale AI investment could drive divergent possibilities – and reward diversified, high quality fixed income and credit strategies.

PIMCO
clock 23 June 2026 • 12 min read
Trustpilot