Experts urge employees to review their pension types and protections to safeguard retirement savings amid rising unpaid pension debts.

This year has already seen £30.6 million in pension debts, signaling a worsening trend alongside high-profile collapses such as the Arcadia Group in 2020, which created a £510 million shortfall for workers at Topshop, Dorothy Perkins, Burton, and Miss Selfridge.

Around 5,730 employers are expected to enter insolvency with pension payments still owed, and 22,930 businesses have collapsed over six years while retaining pension obligations, affecting more than 100,000 workers.

The UK is facing a growing pension crisis as £32.6 million in workplace retirement savings remained unpaid after employers went into liquidation during the 2024/25 financial year, affecting thousands of workers.

The Pension Protection Fund acts as a safety net but cannot guarantee full recovery, with beneficiaries typically receiving about 90% of benefits—potentially reducing a £145,900 average pension for those aged 65–74 by roughly £14,590.

Liqudation data shows over 5,100 insolvencies in the period, with many companies owing pension scheme debts to employees.

Projections expect about £40.2 million in unpaid pension contributions for the 2026/27 year, a 31.1% rise from the prior year and the steepest increase since 2022/23.

Since 2020, outstanding pension contributions have surged by 359%, from £7.1 million at the pandemic’s start to £140.5 million in arrears, averaging around £23 million per year.