Thursday 16 April 2026 2:54 pm
The Tories slammed the powers
The Conservatives have slammed the controversial mandation powers in the Pension Schemes Bill, after parliament swept aside the amendments put forward by the House of Lords.
Labour has come a step closer to finalising the bill, after it used its government majority to stamp out more than 80 amendments put forward by the upper house, who have been in uproar alongside the pension industry over the clause.
The legal clause has been viewed across Westminster and the Square Mile as a power grab which allows the government to exert control over where pension funds allocate their capital.
Other amendments were also rejected, including an attempt to change employer contribution schemes for the local government pension scheme and additional exemptions to the scale requirements that mean multi-employer defined contribution providers must reach £25bn in size by 2025.
In a bid to quell anger, the government passed an alternative wording of the values to limit no more than 10 per cent of assets to be held in qualifying assets, and no more than half in the UK.
Power grab
The Conservatives have long opposed the ‘backstop power’ and reiterated its commitment to “continue to fight Labour’s pension grab and to repeal it in government” prior to the vote.
Shadow chancellor Mel Stride said: “Your savings should be invested in your best interests – not to fund the pet projects of Rachel Reeves. This new law will mean Labour can direct where your pension is invested, leaving you worse off and giving people less security in retirement.
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“Labour have watered down their proposal after fierce opposition, but it needs to be ditched completely.
“The Conservatives would scrap Labour’s pension grab and give people confidence that their savings are safe. Under a Conservative Government your pension pot will be there for you and you alone, not for Rachel Reeves to bail herself out of the economic mess she has created.”
He also slammed Reform UK’s plans for pensions, which Richard Tice has previously said would prop up loss-making companies including British Steel.
Steve Darling, pension spokesperson for the Liberal Democrats also hailed mandation as the “dead hand of government growth”.
Torsten Bell stands firm
Despite the backlash and slight backpedal on the powers, pensions minister Torsten Bell has so far refused to back down and eradicate the power, saving Labour from another policy U-turn.
On rejecting the House of Lords amendments, he said: “To do so would be to let savers down, to ignore the strong consensus about what is in savers’ interests, and to disregard the barriers that we all know are holding back delivery on that consensus.”
But the industry has argued the bill fails to spur investment and chokes pension funds’ ability to make decisions for shareholders, after investment trusts were excluded and VCT tax relief was slashed from 30 per cent to 20 per cent.
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House of Lords warns ministers’ pension power grab ‘dangerous and unjustified’
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