UK Firms Collapse Owing £32.6m in Unpaid Pension Contributions, New Freedom of Information (FOI) data Reveals

VoM News Desk | May 6, 2026 | 02:40 PM IST | Business, World |
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UK Firms Collapse Owing £32.6m in Unpaid Pension Contributions, New Freedom of Information (FOI) data Reveals

UK firms are going bust owing millions in defined contribution pensions, with £32.6m left outstanding last year alone, highlighting a growing risk to retirement savings.

New Freedom of Information (FOI) data obtained by the experts at Liquidation Centre reveals that more than 5,100 employers collapsed with outstanding pension contributions in 2024/25 – nearly three times more than during the pandemic. While schemes like the Pension Protection Fund can step in, not all losses are fully recovered, meaning workers may still see reduced retirement incomes as companies fold.

Following record insolvencies and the collapse of major employers such as the Arcadia Group (owner of Topshop, Dorothy Perkins, Burton and Miss Selfridge), which went into administration in 2020 with a £510 million pension deficit, the experts at Liquidation Centre, a trusted UK liquidation firm focused on solvent liquidations (MVL) for contractors and small business owners, while also supporting Creditors’ Voluntary Liquidations (CVL) for insolvent businesses, sent a Freedom of Information request to the Pensions Regulator to assess the impact of insolvencies on pensions and everyday workers since 2020.

Study highlights:

• £40.2m in pension contributions estimated to be unpaid this financial year (2026/27)

• Since 2020, a total of £140.5 million in defined contribution pensions has been put at risk due to employer insolvencies, an average of £23 million per year

• 2024/25 saw the highest level of unpaid pension contributions since 2020, reaching £32.6 million at the point employers entered insolvency

• Between 2020/21 and 2024/25, the value of outstanding pension contributions linked to employer insolvency surged by 359.39%, rising from £7.1 million to £32.6 million

• Over the same period, the number of employers entering insolvency with outstanding pension obligations rose by +178.01%, climbing from 1,842 to 5,121

Full dataset available here. These figures only relate to defined contribution schemes. *2026/27 estimated figures is forecasted by Liquidation centre

£140.5m in pension contributions have entered arrears since 2020 as firms collapse

Liquidation Centre’s Freedom of Information (FOI) request uncovered that a total of £140,507,995.48 in pension contributions were outstanding at the point employers entered insolvency since  2020, averaging £23m annually.  The 2024/25 financial year saw the highest outstanding pension value since 2020 (£32.6m), and in 2025/26, outstanding pension contributions are already at £30.6m, indicating sustained pressures on businesses.

The value of outstanding pension contributions from insolvent employers  rose by 359.39% since 2020

Between 2020/21 and 2024/25, the value of outstanding pension contributions entering arrears due to employer insolvency rose by 359.39%, increasing from £7,096,494.19 to £32,600,839.85; an average annual rise of 54%. 2023/24 was the only financial year in this period to see a decline, with contributions falling by -7.13% from the previous year. However, levels remained nearly four times higher than in 2020/21.

£40.2m in pension contributions estimated to be unpaid this financial year

Using historical unpaid pensions data, the experts at Liquidation Centre estimate that the 2026/27 financial year could see as much as £40,156,021.90 in unpaid pension contributions – almost £10m more than 2025/26, with 5,730 employers estimated to file for insolvency in arrears. This marks a forecasted 31.1% increase in value from last year and the highest year-on-year jump since 2022/23.

Full dataset available here. These figures only relate to defined contribution schemes. *2026/27 estimated figures is forecasted by Liquidation centre

Since 2020, 22,930 employers entered insolvency with outstanding pension contributions. Between 2020/21 and 2024/25, the number of employers entering insolvency with outstanding pension obligations rose by +178.01%, from 1,842 to 5,121, meaning tens of thousands of employees, and likely well over 100,000, may have been affected.

Nearly three times more employers entered insolvency owing pensions in 2024/25 compared to the pandemic

2024/25 was a record year for employer insolvencies involving unpaid pension contributions, with nearly three times as many employers collapsing with unpaid pension debts (5,121) as during the pandemic (1,842). As of January 2026, the 2025/26 financial year saw 4,486 employers enter insolvency with outstanding pension contributions.

Between 2020/21 and 2021/22, there was a sharp 76.71% increase in the number of employers entering insolvency with outstanding pension contributions. This is likely due to many COVID-era borrowing schemes entering repayment from 2022, leading to sustained pressures in the 2021/22 financial year and almost doubling insolvencies.

Richard Hunt, Director at Liquidation Centre, weighs in on how to ensure your pension remains protected:

“To get ahead of any issues with your retirement savings, we urge all UK employees to review and understand their pension type, as this can change their protection if things do go wrong. If you have a defined benefit pension, your contributions are protected by the Pension Protection Fund (PPF). Defined contribution pensions, on the other hand, are protected by the Financial Services Compensation Scheme (FSCS).

The biggest reduction typically happens with defined benefit pensions, as while the PPF generally pays 90% of what you were promised, you may still see a 10% cut to your expected retirement income. Brits aged 65 to 74 have an average pension pot of around £145,900, according to the ONS, which could mean a reduction of ~£14,590.

It’s also key to regularly compare your payslips to pension provider statements, to ensure that contributions are being paid appropriately and to get ahead of any delayed, missing or lower than expected payments. If you notice anything unusual, contact your pension provider and make a report to The Pension Regulator, who requires employers to pay contributions on time.”

If this content is of use, please provide a link to:  https://liquidationcentre.co.uk/. These linked credits allow us to keep supplying you with future content that you may find useful.

I hope you find this useful.

If you need anything else or are keen to receive future stories that leverage Freedom of Information (FOI) data, please don’t hesitate to get in touch.

Have a great day!

Thank you,

Tori | tori@journalistic.org

Liquidation Centre is a UK liquidation firm specialising in Members’ Voluntary Liquidations (MVL) for solvent companies, trusted by contractors, small and medium-sized business owners, and company directors across the UK. It also assists businesses with Creditors’ Voluntary Liquidations (CVL) when companies become insolvent and need to close in accordance with UK insolvency law.

Methodology:

1. To gather data for this study, Liquidation Centre sent a Freedom of Information request to the Pensions Regulator to determine how many employers entered insolvency while having outstanding workplace pension contributions arrears and how much money is owed from 2020 to 2026.

2. The following questions were sent to the Pensions Regulator:

   1. I am seeking anonymised data on the following from April 6 2020 to April 5 2025:

      1. The number of employers that entered insolvency (including liquidation, administration, or equivalent insolvency proceedings) while having outstanding workplace pension contribution arrears, broken down by financial year.

      2. The total monetary value (£) of unpaid pension contributions owed by employers at the point they entered insolvency, broken down by financial year for the same period.

      3. Only if held, please also provide partial data for both questions for the financial year 2025/2026 to date (April 6 2025 — 12 January 2026)

3. The data provided by the Pensions Regulator refers to the number of employers that entered insolvency (including liquidation, administration, or equivalent insolvency proceedings) while having unpaid employer pension contributions [owing to (a) DC pension scheme (s)] that had been reported as late or unpaid to The Pensions Regulator and remained outstanding at the point the employer entered insolvency (including liquidation, administration, or equivalent proceedings) broken down by financial year.

4. These figures include both employer and employee contributions, and only relate to defined contribution schemes. When a registered UK limited company enters insolvency, the insolvency practitioner works with the pension scheme on securing any outstanding pension contributions through the insolvency process to try and ensure savers lose as little as possible. These contributions would be payable to the pension scheme.

5. Forecasts were generated using a linear trend model applied to six years of historical data and are intended as directional estimates.

6. The study is based solely on information provided directly by the Pensions Regulator in response to the Freedom of Information request outlined above. No responsibility is assumed for any inaccuracies resulting from erroneous data provided by the bodies.

7. All data is correct as of February 2026. Should the Pension Regulator wish to provide updated data, then they can do so by emailing: tori@journalistic.org outlining updates to the data and the reasons behind them.

8. Full dataset available here.

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