Chancellor, Rachel Reeves, has delivered her Spending Review, announcing an expansion of the British Business Bank’s (BBB) financial capacity and a reversal of planned cuts to winter fuel payments.

The Chancellor said the BBB’s total financial capacity will be increased to £25.6bn, supporting a two-thirds increase in support for UK innovative businesses compared to 2025-26 and crowding in tens of billions of pounds more in private capital.

This expansion will take BBB investments to around £2.5bn each year and has been enabled by the changes to the fiscal rules made in the 2024 Autumn Budget.

Although Reeves did not explicitly link the BBB’s increase with pension reform in her speech, both are central to her UK growth agenda.

The Pensions and Lifetime Savings Association (PLSA) has welcomed the investment commitments announced in the review.

In particular, PLSA director of policy and advocacy, Zoe Alexander, called it a “positive” the government is taking forward “crucial investment” in the economy – in infrastructure, housing, defence, energy and health – and increasing the investment capability of the British Business Bank.

Alexander highlighted the commitment made by pension funds to invest more in productive assets in the UK, with the Mansion House Accord announced last month.

“In return, the PLSA has asked the government to play an increased role in creating a pipeline of investment opportunities for pension funds to support UK growth,” she said.

“Today’s spending review represents a statement of intent that is welcomed by the pension fund trustees who, on behalf of millions of UK savers, will weigh up the opportunities this additional public investment presents.”

In addition to the increase to the BBB’s financial capacity, Reeves also confirmed the reversal of the initial decision in 2024 to restrict winter fuel payments only to pensioners with Pension Credit.

Starting in the winter of 2025–26, the means test threshold will be reinstated for winter fuel payments, setting the eligibility at £35,000 and bringing into scope around nine million pensioners.

My Pension Expert policy director, Lily Megson, called the Spending Review a “missed opportunity” to help consumers better understand their pension and save for retirement.

Megson noted that although the reversal of cuts to the winter fuel allowance will provide relief to many pensioners, these only “scratch the surface of a much deeper issue”.

“Pensioner poverty remains a persistent and complex challenge, and it cannot be solved through isolated policy shifts or short-term fixes,” she emphasised.

“What’s needed now is a joined-up strategy, one that prioritises financial inclusion, expands access to retirement advice, and embeds midlife financial education as a core part of lifelong learning.

“Retirees deserve more than reactive support. They deserve a future built on stability, dignity, and the confidence that their retirement plans are protected, regardless of the economic climate.”

AJ Bell head of investment analysis, Laith Khalaf, said that amid growing fiscal pressure, there is a real risk that pensions tax reform speculation, especially around tax-free cash and tax relief, will return to the headlines.

Khalaf suggested that instead of letting uncertainty "rattle" savers, the Chancellor should take "pre-emptive action and introduce a pensions tax lock, ruling out changes to tax-free cash or pension tax relief for the rest of this parliament".

"A firm commitment would offer investors the confidence to plan for the long term and give real momentum to the retail investing revolution Reeves says she wants to champion," he added.

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