This is not a new argument. we’ve been having it all century and in 2014 many thought it had been settled by George Osborne. But pension freedoms haven’t been a success for the silent majority who do not have advisers, have no aspiration to be wealthy and just want enough to have a retirement with holidays and a little security if health becomes a problem. I remember in the 1980s when I started advising people to buy pensions (if they didn’t get a company one) that three quarters of the pension was paid as a lifetime income and the rest was to take care of health problems. I suspect I am not the only one who considers my pot in these terms.

The trouble is that while the people who bought DC pensions in the 1980s were professionals who worried they could only be 17.5% of pensionable earnings (a lot), those who have been saving have not been saving anything like that.

Auto-enrolment had increased the numbers saving into pensions, but it had introduced a new level of contributions that slowly rose throughout the last decade. But it stopped increasing in 2018 and has stuck at 3+4+1 of a band of an employer’s earnings.  We thought that we would see a further increase, were promised an increase in minimum contributions to be made by employer and employee by the middle of this decade, but it hasn’t happened.

When auto-enrolment was introduced, Steve Webb (the pensions minister at the time) told us that the DWP would monitor the amount of income that people could purchase through the following decades. The assumption in 2012 was that all auto-enrolled savings would convert to pensions (except for those who had enough income to be allowed to spend their pot as they chose).

Steve Webb was wrong, the 2014 budget abolished the link between pension saving and a lifetime income from retirement. For a time, people saw their pot as “wealth” and freedom took over as the mantra of DC pension providers. The Government as recently as 2024 were keen to define “value for money” by the rate that a pot built up. With this focus on the size of the pot, the worries about adequacy were put to one side.

All this has changed since the return of a Labour Government; we have had a Pensions Commission tell the country that 15m of the country are set to retire on an inadequate income. The Pensions Dashboard has been unveiled to demonstrate what we have built up, not as a pot but as the income a pot could buy. In line with this we have had a Pension Scheme Act that requires that everyone who doesn’t choose to exercise freedom be defaulted into “a guided retirement pathway”. This sounds too much like the Liverpool Care Pathway for my liking.

For many advisers, the guided retirement pathway is an anathema. It requires no engagement or any “attention to the pension”. It is designed to pay an income that lasts as long as the path taker and is the responsibility of trustees or the contract managers of workplace personal pensions.

On the face of it, workplace “pensions are back as a lifetime income. Except the longevity insurance has been pushed back into later life (Nest have opted for 85). The agreed guided retirement pathway is flex and fix with the flex a guided drawdown and the fix, a late life annuity.

What will be the view of a generation of workplace pension savers? Will they succumb to the default pathway or find an alternative that suits them better. If I was back advising, I would be asking people whether they want control of their savings or to allow it to pass to my workplace pension provider. There has long been an assumption that 80% of people have no interest in taking control of their retirement finances, while 20% will split between those who want to work with an adviser and those who want to take their own decisions.

This Government is happy to see those who have a wish to DIY, take their money wherever it suits them. It is happy that 80% of the working population can follow pathways rolled out to greet them as they reach their normal retirement age.

DC is now a choice for all employers. As it is, an employer can choose to move workplace pension from DC to CDC. The CDC workplace pension makes retirement freedom even harder to achieve and post budget 2014 few would have thought that such a pension would be being promoted. But there appears to be considerable demand for CDC as a collective pension when it comes on the market next year.

It’s emergence as a non-guaranteed undefined pension is a mark of how far the mood of employers and the silent majority.  The 80% have moved away from freedom and towards a requirement for a steady lifetime income.