The UK’s new pensions regulator has said the authority will “encourage” smaller, sub-par company retirement funds to merge into larger, industry-wide schemes – a move that could increase the business of the megafunds.

In his first speech as chief executive of the Pensions Regulator, Charles Counsell, who took up the role at the start of April, said the authority has “very real concerns” about the “very long tail of smaller defined contribution pension schemes”.