Value for money framework: response to consultation, further consultation and discussion paper
Published: 8 January 2026
Closing date: 8 March 2026
Joint publication on the value for money (VFM) framework.
Summary
We are inviting feedback on this joint publication, which sets out proposals for how a VFM framework may be designed to work across defined contribution (DC) trust and contract-based schemes.
The publication covers three areas:
- The Financial Conduct Authority (FCA) response to its earlier consultation CP24/16.
- Proposed detailed rules and guidance for contract-based schemes (implemented through the FCA Handbook).
- Since the Department for Work and Pensions (DWP) will implement the VFM framework for trust-based schemes through legislation under the Pension Schemes Bill currently before Parliament, this discussion paper invites timely and valuable input to help shape those regulations.
The new VFM framework intends to allow industry stakeholders to assess and consistently compare the holistic value of DC workplace pension arrangements, rather than focusing on cost. Greater transparency around key metrics aims to drive better long-term value for savers, supporting and challenging those acting on their behalf.
The framework introduces four elements:
- Consistent measurement and disclosure – trustees and firms must measure and publicly disclose investment performance, costs, and service quality using metrics designed to assess VFM effectively.
- Objective comparison – those responsible for oversight (trustees for trust-based schemes, and independent governance committees and governance advisory arrangements for contract-based schemes) can assess performance against the market on a consistent, objective basis.
- Transparency of outcomes – assessment results must be publicly disclosed.
- Action on poor value – trustees and firms must take specified actions where an arrangement is assessed as not delivering VFM.
Delivering value for money in pensions is a key priority for us, reflecting our commitment to putting savers first. The pensions system must be as efficient and effective as possible, and that means delivering VFM from the moment savers join a pension right the way through to, and including, retirement.
DC savers depend on the system to deliver good retirement outcomes, often without active engagement. Given this, those responsible for overseeing value must focus on what matters most for savers. Current measures fall short in enabling meaningful comparisons across schemes. Trustees need a comprehensive and consistent framework to assess VFM, hold providers to account, and ensure all savers receive value by default.
We aim to drive a long-term focus on VFM across the pensions sector by promoting transparency, comparability and competition. Working with the FCA and DWP, we are proposing a framework to compare investment performance, costs and charges, and service standards.
Underperforming arrangements that are unable to improve are expected to transfer their members to an arrangement that will deliver saver value and exit the market, enhancing overall efficiency.
Now is the time to adopt a consistent and structured approach to VFM assessment that drives better outcomes for pension savers.