The redress on a book of defined benefit (DB) transfer advice has fallen to a "record low" of around 2.5 per cent of the total transfer value, about half the level recorded in early 2025, according to First Actuarial’s Redress Tracker.

This comes as rising government bond yields over the past couple of months have “significantly” reduced expected DB transfer advice redress payments.

The tracker, launched in February, aims to allow First Actuarial to predict more accurately how a firm’s total DB redress liability will change over time, tracking the typical redress payments arising from a portfolio of notional individuals who transferred out of their pension scheme.

First Actuarial head of redress services, Sarah Abraham, said when redress is calculated for someone who has transferred a DB pension into a defined contribution pension, the amount of money the consumer holds in their new pension is compared with the cost of buying an annuity, to broadly replicate the DB pension they gave up.

“Gilt yields are a key driver for annuity prices – the cost of buying an annuity falls as yields increase. This makes the yields available on gilts a key driver of the size of redress payments,” she said.

Since July 2025, returns on equities and other growth assets have trended positively, which has also contributed to an improvement in redress payments.

“Under Financial Conduct Authority rules, redress offers made before 31 December 2025 will reflect market conditions at 1 October 2025,” she added.

Abraham said that the firm expects redress payments to be “lower than ever seen before”, with many cases requiring no pay out at all.

She explained this is “good news” for firms that can now settle complaints this quarter about advice on DB pension transfers, or about recommending that public service workers pay into freestanding additional voluntary contributions instead of buying an extra DB pension.

---