Here is where the problem is. Large consultants are looking to create a new kind of retirement income service , where what is delivered is unique to each person.

Let’s not get carried away.There is nothing unique about the state pension. When people ask the Government “what is my pension”, they don’t get a question back “what would you want it to be”. For most people the delight of a pension is that it is deferred pay arriving once a month , dependably in the bank account and stops when you stop, unless you’ve got a spouse who gets it once you’re gone.

Actually, it’s the dependability of pensions that makes them comfortable. For most of us, having to think about how our money is paid to us is very hard indeed. So tell me the rules!

It is condescending to suggest that any pension provider can shape the pension to the needs of its users. I am unique for my beliefs, my behaviour and not for my financial planning!

“A cohort of one” was the aim of the personal pension back in 1987 when it was launched on us by Mrs Thatcher and her team of what we’d call today “enablers“. It worked for people who had the capacity to take decisions or employ people to take decisions for them but it did not work for the majority of the population who were ultimately given “freedom” but no pension.

I would like to know how my deferred pay keeps pace with inflation, how my spouse will be protected and whether some of my pension can be swapped for cash so that I don’t get hit with a tax-bill. But I don’t have a plan for my future. I didn’t when I was 44, 54 and I don’t when I’m 64. I know that I haven’t spent my pay (and the bonuses I got as a sales person) and now I want to know when and how much I will get when I need to retire. My “need” is created by exhaustion not by a financial plan!

I guess that the state pension age has something to do with my thinking. I am sure that those who work in actuarial consultancies downgrade the importance of the thousand pound a month state pension when strategizing but the people who are retiring don’t!

Far from moving towards a personal pension with a “cohort of one”, most of us want to be part of a collection of people like them who saved together and are now getting paid together, cohorts of millions of people retiring each year.

There were an estimated 12.95 million state pensioners in Great Britain in
2024/25. Around two thirds (8.57 million pensioners) were claiming the pre –
2016 State Pension, while 4.38 million were new State Pension claimants.

The big things that have mattered to most people have gone on because of the state’s planning. When we lost SERPS (S2P) we lost any sense of a pension from the state linked to what we earned and the responsibility for that pension shifted to workplace DC pensions (if you’re in the private section) and remained with the public sector employers (sponsored by the tax-payer).

When the FCA published the numbers on what people were doing with their SERPS replacement, it turned out that most people’s idea of uniqueness was to cash in what they’d saved and have a healthy bank balance for a few years. This was never the plan of Government and it’s what the Pension Schemes Bill (soon to be Act) and CDC legislation is about.

The personal pension (the cohort of one as Mercer calls it) will live on. It will be an opt-out for those who want control of their cashflow or to give control of their finances to a financial planner/adviser. But the personal pension is becoming a side-show by comparison with the guided retirement defaults we will be offered from our workplace pensions and by CDC pensions that will replace the idea of the pot with a whole of life pension (or an “at retirement” pension).

The whole movement of pensions is away from the cohort of one and towards a simple system of second pensions that pays a pension according to the definition of contributions on an earnings related basis. In extremis, you could re-establish SERPS on a DC basis using a national CDC scheme as inclusive as the original conception for Nest. I have friends who would prefer a state run CDC pension differing from SERPS for being funded and to some degree “market related” basis. It would I suppose reduce the reliance on pensions buying gilts.

But for employers and for most workers, the link to the occupational pension is deep .  SERPS never caught on as it was meant to by Barbara Castle , a generation before personal pensions.  A collective DC pension;- whether run off from a pot or as a whole of life pension  – is where we’re headed. The cohort of one is nearly 40 years old and as a personal pension for us all, it is broken.