Over half of UK employers aim to review their pension provider in the next six months amid concerns about a lack of innovation in the industry, according to survey data from Smarterly.

The research, which covered the views of 250 human resources professionals at companies with over 300 employees, found that 54 per cent of employers intended to investigate alternative providers in the first half of 2020.

Meanwhile, 87 per cent had their sights set on a review at some point over the full calendar year.

The workplace savings specialist’s survey also found that almost two thirds (65 per cent) of companies were worried that existing providers were failing to offer enough progressive products for an evolving workforce.

Smarterly head of proposition, Steve Watson, said: “Pension legislation has changed dramatically in recent years, which combined with financial pressures has seen a move away from defined benefit schemes to defined contributions schemes. But the products themselves have remained the same and there is very little innovation the market.”

Watson explained that auto-enrolment has reduced the pressure on providers, who no longer need to design cutting-edge products as they now serve a captive audience.

Smarterly also said customer service levels from providers had suffered a significant fall due to a lack of incentive to excel.

Consequently, 63 per cent of businesses surveyed were keen for a disruptive competitor to enter the market and shake things up.

“Employers are unhappy about the current status quo in the pensions market. Legacy providers are simply not doing enough to keep up with the new generation. The time is nigh for a new player in the market,” added Watson.

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