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On balance, we consider that a system of automatic transfers to the new employer’s scheme is our favoured approach.
This consultation sought views on how government and the pensions community can work together to solve a key challenge facing the workplace pensions system: the proliferation of small pension pots.
We anticipate that automatic enrolment and a highly mobile jobs market will lead to a significant increase in the number of small dormant pension pots in our future pension system. The burden of these small pots is compounded by the fact that systemic barriers, like cost and complexity, prevent people from moving and consolidating their pensions into the one place.