Pensions - Articles - Ongoing protection of workplace pension contributions


Aegon’s Steven Cameron comments on Rishi Sunak’s changes to the Job Retention Scheme and ongoing protection of workplace pension contributions

 Steven Cameron, Pensions Director at Aegon said: “It’s welcome news that as we transition to a shared cost furlough scheme, affected employees will continue to receive pension contributions into their workplace pension on top of up to 80% of their salary. It would have been all too easy for the Chancellor to have forgotten about workplace pension contributions for furloughed employees, but that would have had long term negative impacts for the retirement prospects of many millions.

 “The Job Retention Scheme has allowed a million employers to keep 8.4 million employees on their payroll, ready to return to work as soon as safe to do so, while continuing to contribute to their workplace pensions. Currently, the full costs of this are being borne by the state or taxpayers, rather than employers and as the Government advances plans to gradually reduce lockdown and get businesses back to work, it’s only right to review this.

 “The Government will be hoping this gradual move to sharing of costs gives a further incentive, if needed, to get businesses back up and running, where safe to do so, while protecting employees’ incomes and pensions where not.

 “Compared to current arrangements, by October employers may be paying up to £928 for furloughed employees whose pre-furlough earning were £3,125 or above per month.”

 Current arrangements for someone on a salary of £3,125

 

 In October

   

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