Stories of the week
1) Pension Schemes Act Becomes Law: The Default Decade Begins
The Pension Schemes Bill received Royal Assent on 29 April 2026 after a months-long deadlock between the Commons and the Lords over how far the government can push pension funds around.
Parliament finally agreed the bill on 28 April after the Lords accepted watered-down “guardrails” on Clause 40, the mandation power. The Act becomes the most significant pensions legislation in over a decade, and most of it is now flagged to come into force in stages from late 2026.
What is in the Act
- A new duty on DC scheme trustees to offer “default pension benefit solutions” for retirement income, so the default journey covers not just contributions but how you actually draw an income.
- The legal framework for the multiple default consolidator model, the engine behind the new auto-consolidation of sub-£1,000 deferred pots covered last week.
- A statutory framework for DB superfunds.
- Amended DB surplus distribution rules, with around £160bn potentially releasable from well-funded DB schemes back to sponsors.
- A reserve mandation power, but heavily restricted (see below).
What got cut
- The original wide mandation power that would have let the government compel pension schemes to invest in specific UK assets has been significantly scaled back.
- Hard statutory caps now apply: mandation cannot exceed 10% of a default fund, of which only 5% can be directed into UK assets.
- The reserve power cannot be used before 2028, expires in 2032 if unused, and is repealed entirely in 2035 even if it is used.
- The power applies only to default auto-enrolment funds, not to self-select or non-default money.
- The government also has to publish a report on barriers to UK and private market investment before any of this can be triggered.
The Wiseones Take: Read between the lines and this is the start of the Default Decade. The Act pushes everyone toward the same shape of pension: a default contribution journey, a default consolidator for small pots, and a default retirement income solution at the end. The mandation guardrails are good news on paper, but the bigger story is that competition between providers is going to flatten. If every provider has to offer broadly the same default at broadly the same price, with broadly the same UK exposure, the differentiation that used to drive better outcomes for engaged savers shrinks. Consolidation plus default standardisation is convenient for the regulator and for the Treasury, but “defaults that all look the same” is not the same thing as “defaults that are good”. Engagement matters more than ever, even though the policy direction quietly assumes you won’t bother.
2) Renters Rights Act Bites: Rent Controls Off the Table, Everything Else On
The bulk of the Renters Rights Act takes effect today, 1 May 2026. Section 21 evictions are abolished, all assured shorthold tenancies become periodic, and rent controls have been kept out of the legislation, but the deal for landlords still got worse.
The Renters Rights Act received Royal Assent on 27 October 2025, with the government confirming the main provisions go live on 1 May 2026. Section 21 “no fault” evictions are gone. Existing assured shorthold tenancies all roll into periodic tenancies. Rent can only be increased once a year, and only via a Section 13 notice with at least two months’ notice. The PRS Database is scheduled for a regional rollout in late 2026 and full launch in 2027, with the new PRS Landlord Ombudsman expected around 2028.
On rent controls, the government has explicitly held the line: “We do not want to do anything that could potentially make things much more difficult for tenants, which is why the Government are not advocating rent controls in the Bill.” So rent caps are out, but the rest of the package still tightens the screws on landlords.
What’s the problem? Buy-to-let has been the default “alternative investment” for decades. The pitch was always: tangible, leveraged, capital growth plus rent. The pitch is wearing thin.
What’s changing? The legal balance shifts noticeably toward the tenant from today. No more easy exits via Section 21, less flexibility on rent increases, more compliance via the database and ombudsman, all on top of the Section 24 mortgage interest restriction, the higher stamp duty surcharge, and a CGT regime that no longer has any meaningful inflation indexation.
The Wiseones Take: Even with rent controls off the table, the Renters Rights Act is another reason to question whether owning a single rental property is really an “investment” or a small business in disguise. Net yields after costs are usually thin. Capital is locked up in a single illiquid asset. CGT bites hard when you sell. Disposal takes months and depends on the housing market mood. Tenant void, boiler dies, roof leaks, all of it lands on you. For most people, a low-cost diversified global portfolio inside an ISA or pension wrapper does more, more cheaply, with less stress, and is a phone tap away from being sold. Property as an investment makes sense for a small minority who genuinely run it as a business with scale. For everyone else, broad investing wins, and the legislative drift makes that gap wider every year.
3) Fidelity: UK Investing Never Got Over the Dot-Com Crash
Fidelity has put a number on Britain’s cash habit. Direct equity exposure outside pensions sits 6 percentage points below where it was in 1999, and households have been net sellers of £566bn of investments since 2001.
New analysis from Fidelity International, led by personal finance specialist Marianna Hunt, lays out the cost of the UK’s lost confidence in stocks. Direct investments made up 23% of household financial assets in 1999. By the end of 2025 that share had dropped to 17%. Cash has gone the other way and now sits at 35% of household financial assets, the highest level since the 1980s. Hunt’s headline line: “Despite strong global equity returns in the decades since, households have not meaningfully rebuilt direct exposure to markets.” Fidelity estimates that £414bn more would be invested in UK households today if the 1999 allocation pattern had held.
Fidelity’s recommended fix is three-part: more balanced risk communication that includes the long-term cost of being out of markets, financial education embedded in schools, workplaces and at retirement, and tax / product design that rewards long-term participation rather than cash accumulation.
What’s the problem? The dot-com crash, then the financial crisis, then the cost of living shock, have together hardwired “cash feels safe” into UK saving culture. The trouble is that cash has not been safe in real terms for most of the last 25 years. Inflation quietly removes purchasing power every year, and over a 20 to 30 year horizon the gap between cash and a diversified portfolio is enormous.
What’s changing? Slowly, the policy direction is. The Cash ISA allowance cut from £20,000 to £12,000 for under-65s is part of it. Savvy the Squirrel is part of it, although a truly terrible choice of a mascot. The new default retirement income duty in the Pension Schemes Act is part of it.
The Wiseones Take: Fidelity are right and we’ve been banging this drum since the start. The story we keep telling, and will keep telling, is simple: cash makes you poor, slowly and politely, and investing is not just for the wealthy. £25 a month into a low-cost global tracker, started in your twenties or thirties and left alone, will outdo nearly any cash ISA over a working life. The job is not just to keep saying it, it is to keep saying it without scaring people. The reason households went to cash and stayed there is that the industry has been very good at flagging downside risk and very bad at communicating the risk of being out of the market. Fix that, and a chunk of the £414bn gap closes itself.
Rate Watch
- Bank of England Bank Rate: 3.75% ↔️ (Held 30 April)
- UK mortgage rates (typical averages, Rightmove 24 April):
- 2-year fixed (75% LTV): ~5.03% 🔽 0.07%. Up 0.59% from last year.
- 5-year fixed (75% LTV): ~5.04% 🔽 0.06%. Up 0.62% from last year.
- UK GDP: +1.3% (February 2025 to February 2026)
- UK Inflation Rates year on year (March 2026, released 22 April):
- UK CPI: 3.3% 🔼 0.3%
- UK CPIH: 3.4% (including housing costs) 🔼 0.2%
- UK RPI: 4.3% 🔼 0.7%
Mortgages drifted lower again this week even though the Bank held. Markets are pricing the next move as a cut later in the year, but the dissenting hawk on the MPC is a reminder that energy-driven inflation has not gone away.
Upcoming Dates For Your Diary
May 2026
- 15 May: ONS Q1 2026 preliminary GDP estimate (provisional)
- 31 May: Employer P60 deadline
June 2026
- 18 June: Bank of England MPC interest rate decision
July 2026
- 6 July: FCA commodity derivatives reforms go live
- 30 July: Bank of England MPC interest rate decision
October 2026
- 31 October: Deadline for all pension providers to connect to the Pensions Dashboard ecosystem
Wise Money Tips
- Use your ISA allowance before it resets. Up to £20,000 across ISAs in 2026/27, frozen until April 2031. Don’t forget Junior ISA £9,000 and Lifetime ISA £4,000, both also frozen to April 2031.
- Dividend tax rose on 6 April 2026. Ordinary rate 8.75% to 10.75%, upper rate 33.75% to 35.75%. Additional rate stays at 39.35%. If you hold income shares outside a wrapper, it is worth stress-testing whether ISA or pension sheltering is now worth it.
- Top up pensions and check carry forward. Annual allowance is £60,000 for 2026/27. Tapering can apply for higher earners. Unused allowance from the previous three tax years can often be carried forward.
- VCT timing matters this year. From 6 April 2026, VCT income tax relief dropped to 20% (down from 30%). VCT relief cannot be carried back, so the tax year you subscribe in is the one that counts.
- EIS and SEIS still allow carry back. Unlike VCTs, EIS and SEIS income tax relief can usually be carried back to the previous tax year, which is useful if your tax bill is lumpy.
- Use the small but real allowances. Personal Savings Allowance (£1,000 for basic rate, £500 for higher rate, £0 for additional rate), Marriage Allowance transfer, and the £3,000 annual IHT gifting exemption (resets each tax year, doesn’t roll over).
- State Pension uplift from 6 April 2026. Full new State Pension: £230.25 to £241.30 per week. Basic State Pension: £176.45 to £184.90 per week.
- Check your NI record, especially age 50+. A top-up year can materially improve your State Pension outcome. Pull your forecast and identify gaps before making any irreversible year-end decisions.
- Review your mortgage at least six months before the fixed rate ends. Most lenders let you lock in a new deal in advance.
- Check your workplace pension default fund every 12 months. Defaults change quietly when providers rebrand or get sold.
- Never move money on the back of a cold call, a WhatsApp tip, or a social media ad. Every scam starts that way.
Thanks for reading. See you next Friday.