UK pension system ranked 14th globally
The UK pensions system has been ranked 14th in the 2026 Marsh CFA Institute Global Pension Index, as while recent reforms are expected to improve retirement outcomes over time, challenges with sustainability persist. The UK pension system was given an overall B grade and a total score of 71.6.
The UK scored 75.6 for adequacy and 78.0 for integrity, but just 62.4 for sustainability. Recent reforms, including the Pensions Schemes Act 2026, are expected to improve retirement outcomes over time. However, analysis suggests that pension adequacy will continue to depend on higher levels of retirement saving.
The Netherlands’ pensions system ranked top in this year’s index, followed by Denmark, Iceland, and Singapore. The average value for the overall index increased by 1.1 points from 2025. Countries such as Australia, UAE, Oman, Panama, and China improved their index grade.
Marsh global defined benefit/defined contribution leader, Christine Mahoney, commented on the index, stating that “Pension systems are under real strain. Governments that clarify their pension objectives, strengthen funding, and build flexibility into retirement design will be far better positioned to deliver dignified, secure retirements for the generations ahead.”
The UK’s pension system faces sustainability challenges, with discussions around potential changes to the state pension triple lock potentially having a positive impact. Fiscal incentives to ensure patient long-term pensions capital is invested in productive assets could also help. As fertility rates continue to fall and life expectancies rise, the world’s retirement income systems face increasing pressure.
Tim Jenkins, Marsh Investments and Retirement partner, noted that traditional retirement ages of 60 or 65 are becoming increasingly outdated. He emphasized the need for flexible retirement design, allowing people to access income at different times and structuring products to accommodate changing demographics. He added: “The data make clear that even the best-performing systems need to keep evolving; no system can afford to stand still in the face of these demographic shifts.” He also said: “Retirement design must become more flexible – in when people access income, in how products are structured, and in how we think about the line between work and retirement. That flexibility is no longer optional.”
Mona Naqvi, CFA Institute Research and Policy Center managing director, concluded that “Retirement systems differ across markets, but all face the same long-term challenge: delivering reliable income as demographics shift and markets change. No single policy or investment decision can achieve that. It takes sound system design and governance, alongside careful oversight of investments by those with a fiduciary duty to savers and retirees. The test is whether those decisions work together to serve people throughout retirement, and remain sound for the generations that follow.”
