Employees keen to get their heads around pension changes
With auto-enrolment being enforced on 1st October for all large UK employers, it is estimated that 59% of the workforce are unaware of what it will mean for them.
Under auto-enrolment, most employees will automatically be enrolled into their emploer’s workplace pension scheme, without active involvement, and employers will be obliged to make contibutions to the pension for them. Auto-enrolment is to be rolled out across the UK over the next five years, starting with the country’s biggest employers.
In a survey carried out by Standard Life, four fifths of those polled who would be interested in finding out more and would expect to find out more from their employer, while over half would expect to hear more from the Government.
Ann Flynn, head of Workplace Marketing at Standard Life, said: “For many employers and employees in the UK, the introduction of auto-enrolment is still some way off, due to the staggered start dates.
“So we wouldn’t necessarily expect all employees to be aware of it right now. However, it is reassuring to know there is a real appetite for more information among those who aren’t yet scheme members and that people are keen to understand more about what it means to be enrolled.”
When asked what aspect they would like to find out more about, nearly three fifths of employees said they would like to know more about how much they would need to contribute; 40% want to find out more about when they would start paying; and almost a quarter 23% are keen to know about the investment options.
Over the last few years, there has been a downward trend in the number of people actively saving into a workplace pension.
However, the Department of Work and Pensions estimates that some 600,000 more people will be saving into one as a result of auto-enrolment by the end of this year.
Flynn added: “It is also really encouraging that only 27% of employees without a pension indicated they would want to understand how to opt out.
“This is much lower than many predictions and a positive result given that the figures will include many people who will be financially challenged in the current climate.”