Whilst most Pensions UK members are confident that the pension industry will successfully adapt to any changes over the next decade, many remain concerned over defined contribution (DC) outcomes and political uncertainty.

Research from Pensions UK found that nearly half (44 per cent) of its members expect to see a very significant change in the pensions industry by 2035, or sooner, with over a quarter (28 per cent) expecting to see very significant changes within the next five years.

Yet most remain reassured that the industry will evolve in line with this, as 77 per cent are confident the industry will successfully adapt to demographic and economic trends by the 2030s, with just over one in five (22 per cent) extremely or very confident.

Indeed, the survey found that 88 per cent believe their organisation can respond to major industry shifts by 2030.

And while only 5 per cent described themselves as fully prepared, 34 per cent were very prepared and nearly half (49 per cent) somewhat prepared.

However, there are concerns, as Pensions UK found that the future of defined benefit (DB) schemes remains a concern for 18 per cent of those responding, particularly around skills shortages, over-consolidation, and concentration of risk.

The biggest concern for the sector, however, was defined contribution (DC) outcomes, cited by 74 per cent of respondents, with most expecting more people working longer than planned or retiring into relative poverty as DC reliance grows and DB support declines.

Other challenges highlighted include the sustainability of the state pension and the future of the triple lock, alongside pressures from an ageing population and shrinking contributor base.

Government interference and political uncertainty were also cited as significant risks, as more than half (56 per cent) see political uncertainty as a concern for the 2030s, while 17 per cent identified it as their single biggest worry.

Some called out regulation and governance as a particular concern, with many members expressing frustration at inconsistent frameworks and additional complexity that increases costs for schemes and savers.

In addition to this, pressure to invest domestically was a concern for 32 per cent of responding members, reflecting the government’s focus on mobilising pension assets to support UK productive finance.

The industry's priorities for change reflected these concerns, as, when asked what they would most like to change in the system, 23 per cent pointed to contribution levels, adequacy and automatic enrolment reform.

Other priorities included improved defaults and retirement options (15 per cent), political stability and reduced interference (15 per cent), and simplification and clearer communications (15 per cent).

However, Pensions UK pointed out that, at the same time, members see clear opportunities: 28 per cent identified environmental, social and governance (ESG) and sustainability as areas of growth, while 30 per cent pointed to the sector’s role in wider economic growth.

Technology was seen as the greatest opportunity for the industry, with 62 per cent of respondents highlighting its potential.

In particular, digital tools such as the Pensions Dashboard, AI, and data analytics are expected to support personalised retirement planning, improve engagement, and increase operational efficiency.

Not all are convinced, however, as over a quarter (27 per cent) fear that technology may fail to drive a positive behaviour change.

Commenting on the findings, Pensions UK executive director of policy and advocacy, Zoe Alexander, said: "Now is the time to get ahead of change and shape the next decade for the pensions sector.

"Our 2030 Ready: Industry lens report brings together the views of members and wider industry experts, giving a detailed picture of the challenges and opportunities ahead..

“The momentum created by the Pensions Schemes Bill and the Pensions Commission provides a once-in-a-generation opportunity for the industry to support government in driving change that really works for savers, shaping regulation and championing innovation to make the most of the possibilities ahead.

We are grateful to our members for the great insights they have shared as part of this process."

This article was first published on our sister title, Pensions Age.

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