The Pensions Act 2004 (Code of Practice) (Revocation) Order 2026

The Pensions Act 2004 (Code of Practice) (Revocation) Order 2026 marks a significant development in the regulatory landscape for Collective Defined Contribution (CDC) pension schemes in the UK. Effective 31st July 2026, this Order revokes The Pensions Regulator’s (TPR) Code of Practice: Authorisation and supervision of collective defined contribution schemes, which had been in effect since 1st August 2022. The revocation is a direct consequence of the expansion of the CDC regime to include unconnected multiple employer (UME) schemes, necessitating a new, consolidated Code of Practice to provide a comprehensive authorisation and supervision framework. This transition underscores the government's commitment to fostering CDC schemes as a 'third way' in pension provision, offering a hybrid model between traditional defined benefit and defined contribution arrangements.

The UK pensions landscape is undergoing continuous evolution, with Collective Defined Contribution (CDC) schemes emerging as a key area of innovation. A pivotal regulatory shift in this space is heralded by the Pensions Act 2004 (Code of Practice) (Revocation) Order 2026 (S.I. 2026/709), which formally revokes the Pensions Regulator’s (TPR) existing Code of Practice for CDC schemes. This revocation, effective from 31st July 2026, is not an abandonment of the CDC model but rather a necessary precursor to the implementation of an expanded and updated regulatory framework.

This development is particularly pertinent for legal professionals advising pension scheme trustees, employers, and providers, as it signals a broader regulatory scope for CDC schemes. The original Code, in force since August 2022, primarily addressed single and connected employer CDC arrangements. The impending new Code, which this revocation facilitates, will extend regulatory oversight to unconnected multiple employer (UME) CDC schemes, reflecting a strategic move to broaden access and scalability for this innovative pension design. This article will delve into the statutory basis for this revocation, the nature of CDC schemes, and the practical implications for practitioners navigating the evolving regulatory environment.

The regulatory framework for UK occupational pension schemes is primarily governed by the Pensions Act 2004, which established The Pensions Regulator (TPR) with broad powers to protect pension benefits, reduce risks to the Pension Protection Fund, and promote good administration of schemes. Under Section 92(1) of the Pensions Act 2004, the Secretary of State is empowered to issue Codes of Practice, with the consent of TPR, to provide practical guidance on compliance with pensions legislation.

Collective Defined Contribution (CDC) schemes themselves were introduced into UK law through the Pension Schemes Act 2021. These schemes represent a hybrid approach, blending elements of traditional defined benefit (DB) and defined contribution (DC) pensions. In a CDC scheme, both employers and members contribute to a collective fund, with investment and longevity risks pooled across the membership. Unlike DB schemes, they do not offer a guaranteed income, but rather aim to provide a target pension income for life, adjusted based on the fund's performance. The initial regulatory framework for CDC schemes, specifically for single and connected employer arrangements, was brought into effect by the Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations 2022 and TPR's Code of Practice: Authorisation and supervision of collective defined contribution schemes, which commenced on 1st August 2022.

The Pensions Act 2004 (Code of Practice) (Revocation) Order 2026 (S.I. 2026/709) explicitly revokes TPR's Code of Practice that came into effect on 1st August 2022. This revocation is not a standalone event but is intrinsically linked to the broader expansion of the CDC scheme framework. The explanatory note to the Order clarifies that the revocation is necessary to facilitate the issuance of a new, updated Code of Practice.

This new Code is designed to incorporate the significant legislative changes introduced by the Occupational Pension Schemes (Collective Money Purchase Schemes) (Extension to Unconnected Multiple Employer Schemes and Miscellaneous Provisions) Regulations 2025 (S.I. 2025/1313). These 2025 Regulations extend the regulatory oversight of collective money purchase schemes to include unconnected multiple employer (UME) CDC schemes, a crucial step in making CDC schemes more widely available beyond single-employer arrangements like the Royal Mail Collective Pension Plan, currently the only authorised CDC scheme in the UK.

TPR launched a consultation on its draft expanded CDC Code of Practice in December 2025, aiming to create a single, consolidated authorisation and supervision framework for all CDC arrangements, including UME CDC schemes. This new Code, expected to be finalised and come into effect concurrently with the revocation, will outline TPR's expectations for authorisation criteria, governance, and ongoing supervision across the expanded regime. The simultaneous making of The Pensions Act 2004 (Code of Practice) (Authorisation and Supervision of Collective Defined Contribution Schemes) Appointed Day and Revocation Order 2026 (S.I. 2026/730) confirms that the revised Code will come into effect on 31st July 2026, ensuring a seamless transition in the regulatory landscape.

The legal effect of the revocation is that, from 31st July 2026, the previous Code will cease to have legal force. Practitioners must therefore ensure they are consulting the new, comprehensive Code for guidance on all aspects of CDC scheme authorisation and supervision. While the revocation itself is administrative, its underlying purpose reflects a significant policy decision to broaden the scope and accessibility of CDC schemes, which are seen as having the potential to increase retirement incomes by as much as 60% by enabling greater investment in growth-seeking assets and pooling risks.

The revocation of The Pensions Regulator’s Code of Practice for CDC schemes, effective 31st July 2026, marks a pivotal moment in the development of UK pensions. It signifies the transition from an initial, limited framework to a more expansive regulatory regime designed to accommodate unconnected multiple employer CDC schemes. For legal practitioners, this necessitates a thorough understanding of the new Code of Practice and the underlying Occupational Pension Schemes (Collective Money Purchase Schemes) (Extension to Unconnected Multiple Employer Schemes and Miscellaneous Provisions) Regulations 2025.

Advisers to pension scheme trustees, employers, and prospective CDC scheme providers must familiarise themselves with the updated authorisation criteria, governance expectations, and ongoing supervision requirements that will apply to both single-employer and the newly permitted UME CDC schemes. The move towards a consolidated framework aims to provide greater clarity and consistency, but also introduces new complexities related to the more commercial nature of UME schemes. Staying abreast of TPR's finalised guidance and any further legislative developments will be crucial to ensure compliance and effectively advise clients navigating this evolving and increasingly significant area of pension provision.