PPI report on DC decumulation risk urges unified industry action to enhance retirement support

Article summary

The Pensions Policy Institute (PPI) has published the first in a series of reports examining what an assessment of value for money (VfM) could look like in the decumulation stage of retirement. Its independent research report, sponsored by the Pensions Regulator, is based on literature review and stakeholder interviews and aims to offer a detailed overview of the retirement income market. It explores how defined contribution (DC) savers access and utilise their pension savings and assesses whether the current products and support services adequately meet their diverse needs. The report finds that the decumulation phase of DC pensions poses significant risks to long-term financial security. It shows that, unlike the accumulation phase—where automatic enrolment and structured defaults support saving—the decumulation phase requires pension savers to make active decisions, which often leads to full cash withdrawals from smaller pension pots.