Asset allocation survey

A similar exercise was conducted by The Pensions Regulator looking at master trust (MT) schemes[1].

Using that combined data, the following assessment of the combined market has been produced.

FCA survey results

Summary findings FCA data

• Responses to the FCA survey covered a significant proportion of the contract-based workplace defined contribution default arrangement pension market by assets under management.
• Across responding providers, most assets in default arrangements were allocated to non-UK assets, with non-UK assets accounting for 84.91% of the weighted total.
• Listed equities were the largest asset class, particularly non-UK listed equities, which accounted for 67.63% of the weighted total.
• Responding providers reported around 4% of disclosed default assets in unlisted private market assets. If listed investments in private market asset classes are included, exposure rises to c.6%.
• UK unlisted private market exposure accounted for around 1.5% of disclosed default assets.
• Several firms indicated that the asset allocation of their default funds is under review, with potential increases in private market and UK-based assets over 2026 and 2027.
• The survey also helped identify practical reporting issues for the proposed Value for Money framework, including asset class definitions, UK and non-UK categorisation, decimal places and rounding.

Purpose and context

In January 2026, we surveyed a selected group of contract-based pension providers to understand how assets are allocated within the accumulation phase of the main default arrangements of their workplace pension products. Providers were selected primarily on the basis of scale of assets under management in pensions accumulation.

The information requested broadly aligns with the proposed asset allocation requirements under the Value for Money (VFM) Framework, which is currently under consultation. The survey was intended to support our evidence base and inform the proposed design of the asset allocation section of the VFM framework. It also provides a baseline view of default fund investment across different asset classes.

Consistent with the wider VFM framework, the survey focused on default arrangements used by workplace pension schemes. This broadly reflects where most pension savers enrolled through automatic enrolment, and who do not make an active investment choice, are invested.

We requested asset allocation data at arrangement level and did not, for this iteration, request data split by saver cohorts based on time to retirement. We recognise that this additional detail will be required under the proposed VFM framework and can show how asset allocation varies over the investment period. We will consider whether to include this granularity in future versions of the survey as it is our intention to run a similar asset allocation survey annually until the VFM framework comes into effect.

Scope of analysis

This analysis examines asset allocation data from 8 contract-based pension providers as at 31 December 2025. This covers approximately £260 billion of assets (an estimated 80-90%  of relevant in scope contract-based workplace pension assets). 

Focusing on asset allocation across contract-based workplace DC arrangements during the accumulation phase the datasets out:

• Asset distribution across key asset classes (for more information see Table 2)
• Key findings of use in development of the Value for Money (VFM) Framework

The figures below represent the asset allocation percentages weighted across all responding providers.

Table notes:

1. The Private markets figures above include private equity. Private credit/debt. Real estate and infrastructure. 
2. All figures are rounded to 1 decimal place.
3. Our survey sought asset allocation data at a more granular level, in some areas we have combined categories for simplification.

Implications for VFM reporting

The survey helped inform the latest consultation on the Value for Money framework by testing a simplified version of the proposed asset allocation reporting requirements. 

Responses highlighted practical issues that could affect the consistency and comparability of reporting across providers.

In particular, responses highlighted the need for clear and consistent asset class definitions to support comparability between arrangements. The survey highlighted areas where firms may interpret the definition of asset categories differently, particularly where market practice varies. Responses also highlighted more complex reporting questions, such as whether some asset classes should be reported using the money which has already been invested in those assets (deployed capital) or should include money which is set aside for such investment but hasn’t yet been used (committed capital).

The latest consultation therefore includes further proposals on asset class definitions, while recognising that some differences may remain where external data providers use different classifications.

The survey asked providers to split asset allocation data between UK and non-UK assets. Some respondents said this split may not always be available. We have therefore proposed additional reporting fields for cases where the UK/non-UK categorisation cannot be determined.