Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what discussions he has had with The Pensions Regulator on what estimate it has made of how many and what proportion of UK pension scheme assets invested in (a) thermal coal-fired and (b) any other fossil fuel-fired power generation capacity; what assessment it has made of the potential impact of using UK pensions funds for expanding the use of fossil fuel on the markets of (i) the UK, (ii) Europe and (iii) any other country; and what estimate it has made of the value of UK pension funds invested in fossil fuels that are at risk of becoming stranded.

The Pensions Regulator (TPR) has not produced such estimates. As part of its supervision and to assist in understanding the link between performance and asset allocation, TPR now gets access to investment data from workplace pension schemes – including increased transparency on scheme decision-making, as well as probing investment governance standards.

Occupational pension schemes are required to set out how they consider financially material environmental, social and governance factors in their Statements of Investment Principles and to report annually on implementation. Larger schemes must also disclose their climate related risks and opportunities in line with the Task Force on Climate related Financial Disclosures framework. A 2024 TPR review found that more than 60% of sampled schemes had set a net zero goal for 2050 or earlier. The Department for Work and Pensions (DWP) is currently undertaking a Post Implementation Review of the TCFD regime. We will report our findings this year.

In parallel, Government is working on the adoption of UK Sustainability Reporting Standards aligned with international standards and on mandating climate transition plans. TPR’s Transition Plan Working Group, which includes representatives from across the pensions industry, will report to the DWP in the spring. These initiatives will continue to strengthen transparency around scheme exposures to climate related risks and support the UK’s net-zero goals and broader green agenda.