As we move into the 2026 to 2027 financial year, pension scheme administration continues to face unprecedented challenges.
Across defined benefit schemes, administrators, scheme managers, regulators and trustees continue to balance major delivery pressures. There are rising expectations on service delivery, building operational resilience and scheme governance.
It's a demanding mix! However, these demands also brings opportunities to strengthen the foundations that members rely on.
Each scheme’s starting point will be different: some public service schemes are managing large scale transition to new administrations, others continue to work hard to complete remedy implementation, and many will be preparing for new statutory or regulatory requirements.
Yet there are common themes running through the year ahead. In this article, we reflect on the key areas that are likely to shape pensions administration through 2026 to 2027 and beyond.
Current state of play: pressure, complexity and scrutinyPublic service schemes are operating in a context of accelerating change. Policy and regulation are moving quickly, operational risks are more visible, the Pensions Regulator (TPR) is applying more scrutiny to scheme administration and scheme management, and member expectations continue to rise.
At the same time, many teams are navigating capacity constraints, legacy processes and systems, as well as significant programmes of work that will run for several years.
In practice, this means that administration leaders and scheme managers need to keep one eye on immediate delivery and another on medium to long- term readiness.
Against that backdrop, several themes stand out as most likely to shape the financial year ahead.
The financial year 2026-2027 will be a period of additional scrutiny across the industry. Credit: Shutterstock Governance and standards: raising the barThe direction of travel on governance is clear. Government and regulators are signalling higher expectations on capability, oversight and decision making. That shift is not limited to private sector arrangements.
Public service schemes are aware of the greater focus on the:
evidence behind decisions strength of their scheme controls effectiveness of monitoring, particularly where services are outsourcedThis matters because stronger standards tend to create sharper questions:
How well does the governing body understand operational performance? How confidently can it challenge providers? Are they being provided with sufficient data to do so? How robust is reporting on key risks such as cyber resilience and data quality?In 2026, schemes that can demonstrate a clear line of sight from governance to day-to-day delivery will be better placed to respond to regulatory attention and to emerging issues.
For LGPS, governance reform continues through the ‘Fit for the Future’ work programme. The pace of regulatory change adds another layer of challenge, particularly where administering authorities are already stretched.
Building realistic delivery plans, supported by clear prioritisation, will be essential to avoid rushed implementation and avoidable compliance risk.
McCloud remedy: a multi-year delivery challengeFor many public service schemes, remedy work remains the largest and most complex operational programme.
While the legislative framework is in place, the delivery reality is that this is not an easy project to implement.
It involves data gathering and cleansing, extensive rework of member calculations, retrospective benefit adjustments and long-tail processing. (This is where cases take longer to process because there are issues with the quality of the data held for individuals. They are either more complex than standard cases, or they need manual intervention or adjustments compared to standard cases.) The scale is particularly significant.
Remedy work, business as usual delivery and transition activity can quickly compete for the same people and the same management attention.
The practical implication is that schemes need sustained, not temporary, plans including:
resourcing strategies clear triage of cases well designed, coded and tested automated calculation solutions for dealing with remedy cases robust quality assurance processes in place realistic and clear communication approaches for membersKeeping service quality stable while remedy work continues will be one of the defining tests of the year.
The Pension Schemes Bill: policy moving into practiceThe Pension Schemes Bill is expected to pass into law during 2026, and public service schemes will feel its effects even where measures appear aimed elsewhere.
Some reforms are primarily directed at the private sector. However, wider requirements from TPR around data quality, record keeping and implementation scrutiny are likely to have spillover impacts for public sector administrators. This could be especially where members have mixed employment histories.
Guided retirement expectations are more directly linked to defined contribution arrangements. Public service schemes will still want to consider what good member support looks like where members are navigating different pathways between public and private pension provision.
This is particularly relevant in scenarios where members are approaching retirement age and may be engaging meaningfully with their pension for the first time. This is often a communications challenge as much as a technical one. It is critical to get it right to enable members to make well informed choices and receive their benefits in a timely manner.
TPR guidance: Data as a strategic assetAt the end of 2025 TPR published revised member data guidance that consolidated all data related information into one place. It set out the expectations to help schemes deliver data management capability to the requisite standard.
The TPR’s focus over 2026 to 2027 regarding data quality will mean schemes should pay particular attention to data quality through:
regular data assessments reporting management strategies improvementsTrustees and Scheme Managers are ultimately accountable for data quality outcomes. They should therefore have strong governance mechanisms in place to demonstrate how the necessary standard is being achieved. This should include contractual mechanisms of challenge to third party service providers where standards fall beneath the required level.
Member data should be treated as a strategic asset as good data is the foundation of good governance. It is essential for both accurately matching members to their pensions and for calculating value data used to determine benefits. This is critical as schemes prepare to connect to pensions dashboards.
Pensions dashboards: final delivery stretchAll schemes, including public service schemes (unless a prior agreement is in place), must connect to the pensions dashboards ecosystem by 31 October 2026.
As dashboards move from concept to operational reality, the centre of focus is shifting towards data quality and implementation.
Data matching, accuracy, response times and operational resilience will matter in practice, not just in design. This links heavily into TPR’s strategic focus on data quality and the associated strong governance.
Public service schemes often face additional complexity. This is because membership histories can span decades, involve multiple employers and payroll systems, and include legacy transfers and partial service records.
High volumes of deferred members add further challenge. That combination means cleansing and technical work in 2026 is not optional. For many schemes, dashboards readiness will absorb significant capacity throughout the year. Workforce planning and operational considerations should be a key focus, informed by user testing over the upcoming months.
The key question for 2026 to 2027 is simple. Are you building a sustainable approach to data quality, and sustainable workforce planning, or relying on repeated project-based fixes? Schemes that embed ongoing validation, cleanse and improvement into business as usual are likely to be more resilient, not only for dashboards but also for future regulatory and operational demands.
The launch of Pension Dashboards will see individuals’ full employer linked retirement savings come together under one accessible solution for the first time. Credit: Shutterstock. Capacity, contracts and the push towards automationAdministration capacity remains under sustained pressure. Caseloads are rising in both number and complexity. Recruitment of skilled pensions administration professionals, especially in the DB market, remains competitive and challenging, and legacy administration systems and processes can limit efficiency. Where there are major contractual changes or provider transitions, the risk to delivery increases further.
Looking ahead, we can expect more investment in triage, redesigned processes and selective automation to make delivery more sustainable into the future.
Equity reforms and reporting: the gender pension gapFrom April 2026, new measures to address the gender pension gap in the local government pension scheme come into force. These include making unpaid additional maternity, shared parental and adoption leave automatically pensionable, alongside new reporting requirements and backdated pension adjustments for eligible partners. These are important changes, but they also create practical complexity.
Administrators and employers will need to manage recalculations, payroll and HR interface updates, and ongoing monitoring and reporting. Clear processes, strong employer engagement and good quality data will be essential to deliver the policy intent while keeping operational risk under control.
Looking further ahead: Inheritance Tax and increase to minimum pension ageSchemes and funds should also begin preparing for the administrative implications arising from the forthcoming changes to Inheritance Tax legislation, considering any implications in relation to defined contribution elements and AVCs. In addition to the increase in the minimum pension age, which is due to take effect in 2028.
These reforms are expected to introduce:
new compliance requirements record keeping adjustments changes to member calculations and member communication obligations… all of which may necessitate updates to internal processes and system capabilities.
SummaryThe financial year 2026 to 2027 looks set to be a pivotal period for public service pensions administration.
Schemes are facing simultaneous delivery challenges, including:
remedy implementation dashboards connection governance expectations reform administration operational pressureYet there is also an opportunity. Schemes that invest early in capability, technology, data quality and governance can strengthen resilience and improve outcomes for members over the next few years.
In a period of heightened scrutiny and high member expectations, that focus on high standards of administration is not just a compliance requirement. It is central to maintaining confidence in public sector pensions.
If you would like to discuss the challenges and opportunities of the financial year ahead, and how our pensions administration experts at GAD can help, please contact jemma.byrne@gad.gov.uk and isla.coates@gad.gov.uk.
DisclaimerThe views expressed are the author’s own and the opinions in this blog post are not intended to provide specific advice. For our full disclaimer, please see the About this blog page.
seen at 15:06, 29 April in Actuaries in government.