FORTHCOMING DEVELOPMENT: While hosting a roundtable meeting with leaders of the UK’s biggest businesses in the City of London on 28 January 2025, Prime Minister Keir Starmer and Chancellor Rachel Reeves outlined plans to lift restrictions on Defined benefit (DB) pension funds with well-funded Surpluses in order to free up capital for investment in UK businesses as part of the Labour government's wider application to fuel economic growth. The government’s thinking is that where trustees agree to share a portion of scheme surplus with the employer, it may choose to invest these funds in their core business and/or provide additional benefits to scheme members. The changes aim to unlock an estimated £160 billion currently held in surplus by approximately 75% of schemes. Legislative changes are proposed to allow all DB schemes to modify their rules for surplus extraction, subject to trustee-employer agreement. However, the government emphasises that these changes will be implemented with appropriate safeguards to protect member benefits. These surplus reforms build on the Chancellor’s proposals outlined on 14 November 2024 during