Some £5.4bn was put into defined contribution (DC) pension schemes last year – an increase of 21% year on year, according to The Pensions Regulator (TPR).
The watchdog’s annual DC Trust report showed a total of £48bn is now saved into DC pension schemes.
The information in the report is based on data provided by schemes on returns TPR issued from July to December 2017 and related to the levy year 2016 to 2017 or earlier.
Memberships have increased to 12.6 million people, up by almost 30% over the past year, and by more than 40% since the start of 2010. Master trusts account for a major proportion of that increase, with 10 million DC savers.
Master trust members have increased from 270,000 at the start of 2012 to almost 10 million in 2017, and the average asset per membership declined from £4,700 in 2016 to £3,900 in 2017.
The same report demonstrated 90% of people saving into a private sector pension are doing so via a DC arrangement.
It also found since 2010 the number of schemes – not including micro or self-administered schemes – has reduced by 52% from 4,560 to 2,180.
Acting executive director for regulatory policy, analysis and advice, Anthony Raymond said: “The success of automatic-enrolment has put DC schemes – and particularly master trusts – at the heart of pension saving in the UK, and our figures illustrate this trend.
“For these new and existing savers, we have a role to protect their benefits and so we are working hard to drive up standards of trusteeship.
“We welcome the continued reduction in numbers of DC schemes. We have been concerned about a tail of sub-standard schemes and have been encouraging trustees who cannot or will not meet the standards we expect to consider consolidation.”
It comes as the watchdog is implementing the Pension Schemes Act 2017, which requires master trusts to meet a clear set of standards to obtain regulatory authorisation to operate.
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