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Auto-enrolment is working, says Pensions Regulator

Friday, May 6, 2016

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The Pensions Regulator has published its latest figures showing employer compliance with automatic enrolment since it was introduced in October 2012.

More than six million people have been automatically enrolled into workplace pensions since 2012 and more than 100,000 employers have completed the process.

In January 2013, auto-enrolment accounted for 13 per cent of employees in a workplace pension scheme – the remaining 60 per cent were already in a scheme and 27 per cent were not in workplace pensions at all.

As of March this year, this figure has more than doubled, with 28 per cent of employees now in a workplace pension scheme.

Alistair McQueen, savings and retirement manager at Aviva, which produced the report jointly with the Pensions Regulator, said: "Auto-enrolment is a force for good and it is working - more than 6 million people have now been auto-enrolled and its impact is growing."

McQueen warned against complacency however, adding that while 110,000 employers have implemented auto-enrolment, there are still more than one million still to complete.

The research found that the majority of both employers and employees, 61 and 62 per cent respectively, support auto-enrolment - an increase from 58 and 59 per cent in 2013.

It also found that a large majority of employees – 93 per cent – who have experience auto-enrolment found the process to be straightforward.

However, 55 per cent of employers found the same – and just 24 per cent of small firms.

"Aviva research shows that smaller employers are feeling the strain," said Alistair McQueen, "keeping up with regulation is a number one concern amongst small employers, and today's data shows a concerning acceleration in the use of penalties"

He added: "The need for auto-enrolment to succeed is critical for savers in the UK – it is critical we help more people save more for their retirement and this data reminds us that it is premature for anyone to declare victory."

First published 06.05.2016

Lindsay.sharman@wilmingtonplc.com