Pension Funds Insider

Pension Funds Insider brings the latest pensions news and industry insights; from investment and governance updates to new mandate appointments and pensions regulatory information.

Auto-enrolment tops half million mark

13 April 2017

Image for Auto-enrolment tops half million mark

The 500,000th UK employer has completed their workplace pension duties, according to new figures released by The Pensions Regulator (TPR).

The report shows that by the end of March this year, 503,178 employers had completed their duties, meaning more than 7.6million workers have been put into a workplace pension scheme since 2012.

TPR said the pace of automatic enrolment continues to increase, with 136,000 small and micro employers complying with the Pensions Act in the first three months of 2017.

Pensions Minister Richard Harrington said the new figures show that by setting up a workplace pension, employers are getting their staff on the road to a financially secure retirement, but there is still come way to go.

"There are nearly one million employers out there that still need to enrol their staff and I would encourage them to take up the support on offer," he said.

Around 1.3 million to 1.4 million UK employers have automatic enrolment duties to meet.

On top of the 136,000 small and micro employers who have met their workplace pension responsibilities in 2017 already, around a further 600,000 have responsibilities that begin this year.

Charles Counsell, TPR's executive director of automatic enrolment, said: "We expected the number of employers becoming compliant would increase dramatically this year and I'm delighted that we've reached the 500,000 mark.

"Hundreds of thousands more employers are due to follow suit over the coming months and it is vital that they act early and do not leave themselves open to being fined."

The success of the scheme to date doesn't account for some of lowest paid workers however, something the government is being called upon to address.

Graham Peacock, managing director of Salvus Master Trust said: "Many workers simply are not eligible for auto-enrolment."

"Many will be lower-paid anyway, often working multiple jobs to get by, and they stand to be doubly disadvantaged as they will miss out on the financial safety net enjoyed by those earning higher wages while the possibility of a comfortable retirement slips ever further away."

"The industry, employers and the government should not rest on their laurels – they need to work to widen the criteria to enable as much participation as possible from workers in these groups."

"It is imperative we work to get across the message of how effective saving into a pension scheme is."

First published 13.04.2017

Lindsay.sharman@wilmingtonplc.com