Rona Train, Partner and Senior Investment Consultant, Hymans Robertson, responds to today’s workplace pension figures from the DWP: “It’s brilliant to see today’s figures from the DWP revealing that 84% of eligible employees are now saving into a workplace pension. However, we shouldn’t fall into the trap of believing we’re out of the woods just yet. The truth is that many people are still not saving enough. While contribution levels of 8% may be okay for some it will be woefully short of a decent retirement income for the majority. Therefore, it’s important that employers do not simply wipe their hands and say ‘job done’ when it comes to their pension responsibilities. Millions of pounds a year are going into master trust pension arrangements and it is vital that employers monitor that the specific needs of their members are being met, particularly as each Master Trust’s proposition is evolving as they grow. Standards such as the Master Trust Assurance Framework look set become crucial as employers look to choose the best vehicle for their members’ savings.”
Steve Webb, Director of Policy at Royal London said: ‘The first phase of automatic enrolment has been a stunning success. Nearly ten million more people are saving in a workplace pension compared with 2012, and the growth in coverage has been particularly marked among younger workers, women and those in smaller firms – all groups who have traditionally had low levels of pension coverage. But we need to beware complacency. This is a vital first step, but it is a very long journey. We now need to nudge people to save more, for example when they get a pay rise, so that more people have the financial future that they want and expect’
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