In the UK, “pension freeze” can mean either a specific protective order made by The Pensions Regulator or, more loosely, a pension scheme that has closed to active members or stopped future benefit accrual. Those are different situations. A scheme being described as “frozen” does not, by itself, mean a statutory order has been made or that benefits already built up have disappeared. Check the scheme notice and ask the trustees or administrator exactly what has changed.
What does “pension freeze” mean?
The phrase has two main uses in UK workplace pensions. One is a formal legal measure under section 23 of the Pensions Act 2004. The other is an everyday description of a scheme’s status, often used when a defined benefit (DB) scheme no longer has active members.
| Meaning | Who or what determines it | What may stop |
|---|---|---|
| Statutory freezing order | The Pensions Regulator, under section 23 of the Pensions Act 2004 | Benefit accrual stops during the order; additional restrictions may apply if specified in the order. |
| Scheme described as “frozen” | Usually the scheme’s status under its arrangements and rules | Future active-member accrual may have ended. The treatment of benefits already earned depends on the scheme rules and circumstances. |
These meanings concern UK law and UK pension schemes. The legal rules below should not be applied to pension arrangements in other countries.
What is a statutory freezing order?
Section 23 of the Pensions Act 2004 allows The Pensions Regulator to make a freezing order for an occupational pension scheme that is not a money purchase scheme. It is a protective regulatory measure pending consideration of a winding-up order. The statutory conditions include an immediate risk to members or scheme assets and the need for the order to protect members generally. It is not simply another name for an employer or trustees choosing to close a scheme to future accrual.
The Act says an order must direct that “no benefits are to accrue under the scheme rules to, or in respect of, members of the scheme” while it is effective. An order may also impose specified restrictions on matters such as new membership, contributions, benefit payments, refunds or transfers, within the limits set by the Act. The details of the particular order matter: not every possible restriction automatically applies. Read section 23 of the Pensions Act 2004.
What if a scheme is called “frozen” but there is no statutory order?
The Pensions Regulator uses “frozen” in guidance on multi-employer DB schemes to describe a scheme that has “ceased to have active members.” In ordinary use, that can mean active members have stopped building up further benefits under the scheme. It does not, on its own, establish what happens to benefits earned before the change, including their revaluation or the terms on which they can be taken at retirement. Those points depend on the scheme rules and the member’s circumstances. See the Regulator’s guidance on multi-employer schemes and employer departures.
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A closure to future accrual and a statutory freezing order are therefore not interchangeable. If a letter says your pension is “frozen,” ask whether it means a section 23 order, closure to future accrual, or another scheme event, and request the effective date and the relevant scheme-rule explanation.
Does a pension freeze mean benefits or contributions have disappeared?
No single answer follows from the word “frozen.” Under a statutory order, benefit accrual is stopped for the order’s effective period, and additional restrictions may be imposed. Under an ordinary closure to active membership, future accrual may stop, but the phrase alone does not say that benefits already earned have been cancelled. The scheme’s rules and the exact notice determine the member-specific position.
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Nor does employer financial difficulty automatically mean that pension contributions have stopped. The Regulator says contributions due for employees who are members of an occupational pension scheme must still be paid during a company moratorium. That is distinct from a section 23 order, which may restrict specified further contributions. The Pensions Regulator explains contributions during employer moratoriums.
What if an employer leaves a multi-employer DB scheme?
An employer’s departure from a multi-employer defined benefit scheme can raise a separate issue: a section 75 debt may arise under the applicable rules. The Regulator distinguishes that debt from ordinary scheduled contributions. Whether a debt arises, and its amount, depend on the scheme and legal circumstances; an employer exit does not mean every case produces the same outcome. The Regulator’s employer-departure guidance covers section 75 debt.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What should you check if you are told your pension is frozen?
- Identify the event. Ask the scheme administrator or trustees whether the notice refers to a statutory section 23 freezing order, closure to future accrual, an employer event, or something else.
- Confirm the effective date and scope. Ask what stopped on that date: future benefit accrual, contributions, new membership, benefit payments, transfers, refunds, or another activity. For a statutory order, request its directions or an explanation of the restrictions that apply.
- Ask about benefits already earned. Request the scheme’s explanation of how accrued benefits are treated, including any applicable revaluation and retirement terms. Check the governing scheme documents rather than relying on the word “frozen.”
- Check contributions separately. If you are an active employee, ask whether contributions due for you are still being paid and whether any change concerns employee contributions, employer contributions, or future accrual.
- Keep the notice and get a written answer. Trustees should communicate about employer events before or at the start when possible and appropriate. If the notice is unclear, ask the trustees or administrator to identify the relevant scheme rule or regulatory order. The Regulator’s guidance explains how trustees should deal with employer events that concern members.
Does the DB funding code define a pension freeze?
No. The Pensions Regulator’s DB funding code is practical guidance on complying with legislation, not a definition of “pension freeze.” It is in force from 12 November 2024 and applies to valuations with effective dates on or after 22 September 2024. Those dates concern the funding code’s applicability, not whether a particular scheme has been frozen. Read the Regulator’s introduction to funding defined benefit schemes.
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