At 1 January 2024 the average pot value stood at £5.846, in comparison to £17,206 in 2012.

One of the causes of the drop is a huge growth in scheme membership due to the introduction of auto-enrolment.

There were 27.2m DC scheme members at 1 January.

In 2023, 340 DC pension schemes were used for auto-enrolment, a 42% increase in the 240 used for the same purpose in 2016.

In total in 2023 99% of members of DC schemes were in schemes that have been used in auto-enrolment.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said that the latest figures from The Pension Regulator demonstrate how those saving under auto-enrolment may not be saving enough.

She said there is a risk that “when expanding their pension schemes to more people, employers have made them decidedly less generous, so fewer people have nothing, but more of those who are saving aren’t doing enough to secure a decent retirement income.”

She added that the extension bill to auto-enrolment could help solve the problem.

She said: “It does also point to the importance of assessing AE contribution levels to make sure they are adequate and able to help people build a resilient retirement income. The Auto-enrolment Extension Bill reforms would have a big impact here by enabling people to start their pension saving journey earlier and it is disappointing that these reforms could be delayed until later this decade.

“Other reforms could include looking at how employers could be incentivised to contribute more to their employee’s pensions – for instance boosting the contributions of those employees who are willing to put in more themselves.”

According to the data, the market also continued to concentrate away from smaller schemes. The number of non-micro DC and hybrid schemes decreased by 11% over the last year while the number of members increased by 9%. The reduction in schemes was solely driven by schemes with fewer than 5,000 memberships.

Of all DC schemes, master trusts accounted for over 90% of non-micro memberships and 78% of total assets.

A spokesperson for The Pensions Regulator said: “A drop in average asset values since 2012 highlights the success of automatic enrolment (AE).

"The AE programme transformed the savings landscape with millions more people now saving into a pension for the first time or saving more. This influx of new savers, combined with the retirement of defined contribution members who had been saving for longer and so built larger pots, initially caused average assets per member to decrease with some years seeing significant falls. 

"However, this trend stabilised and since 2020 average assets per member have risen every year.”