I’m a pensions expert – after my husband died, I realised how confusing the system was

The UK’s pension system is “complex” and “confusing”, even for those who know it best, Sarah Smart, chair of The Pensions Regulator (TPR), has admitted.

After her husband died last August, she found navigating the system difficult – despite working in the field.

She told The i Paper: “I’m a pensions expert, and my husband was a pensions expert as well. I found the pension stuff I had to deal with, both before he died and afterwards, difficult and confusing and complex.

“I know what I’m doing, and I had lots of people helping me who knew what they were doing as well, and it was difficult for me.”

For most people, Smart warned, the challenge is even greater.

To help those people, she, alongside other experts, is working on launching the delayed pensions dashboard which will allow people to view all their pension pots in one place.

Smart acknowledged that it’s something that will take time, explaining: “It’s a massive task, given the state of the records that we have, and the number of them.”

But she warned against rushing the rollout. She said: “If we start on the wrong foot, that would be bad. It’s clearly not going to be great if we launch the dashboard and people look at it and there’s loads of rubbish information.”

The first phase of the dashboard is set to be launched this year, with full implementation due by next year, but delays have raised concerns.

While Smart admits the delays are frustrating, she stressed that it’s crucial to get it right. “We don’t want to get it wrong.”

More information and help geared towards pension education will be particularly important following the shift in the UK’s pension system to defined contribution (DC) schemes, which became more popular after the introduction of auto-enrolment in 2012.

These schemes place the financial risk on individuals, meaning the amount retirees receive depends on the contributions they make and the investment performance of their pension pot.

However, many workers still have limited control over the scheme they are enrolled in. Employers typically select the pension scheme for their staff, often driven by cost rather than the value or quality of the scheme itself, Smart said.

This lack of transparency means many workers may find themselves in schemes that fail to deliver strong returns, without even realising it.

TPR is now working with the Government on a new “value-for-money” framework aimed at addressing this issue.

The goal is for employers to be able to choose schemes based on whether they deliver good value for money, with TPR overseeing the process to ensure that schemes are meeting the necessary standards.

Further reforms are needed

But for many people, particularly those facing life-changing events like bereavement or cognitive decline, understanding and accessing their pensions is an even greater challenge.

The Financial Conduct Authority (FCA) has committed to offering “targeted support” to those in need, and Smart believes this will be crucial.

She said: “There’s a lot of work to do in this area, but ‘targeted support’ will be essential.

“We need to think about all the different avenues people will access that, because who people trust for their financial support is an important factor.”

One of the key issues in the system is the reluctance of employers and pension trustees to help workers navigate pension decisions, fearing they may be seen as offering regulated financial advice, she explained.

Smart believes this is an issue that needs addressing. She said: “People will often look to their employers or trustees for information, and they should be able to provide some without thinking that they’re going to be wrapped over the knuckles or get regulatory action against them.”

Labour has committed to making reforms to the pension system, and phase two of the pensions review, which is due to be published later this year, will be critical. This phase will focus on improving retirement outcomes and ensuring people are saving enough.

The Government has also expressed support for pension superfunds, which would consolidate smaller schemes and improve investment returns.

However, Smart cautioned that reform must be carefully considered. She said: “There’s always trade-offs, individually and as a society, for where our money needs to be.”

While she acknowledged the success of auto-enrolment, which has increased pension saving across the UK, she believes more work is needed to make sure their savings are getting optimum returns.

She added: “Let’s make sure that the money people are saving is working.”

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Sarah Smart has decided to step down as chair of The Pensions Regulator (TPR) in July 2025 after nine years on the board.