Fewer than one in ten workers opt out of auto-enrolment
The Government scheme was set up to get more people saving for a pension in a bid to address the issue of what the DWP calls the ‘chronic under-saving’ by UK workers for their retirement.
Before the scheme started, the DWP predicted that 30% of workers were likely to opt out.
The first official auto-enrolment report looked at opt-out rates among the 50 biggest employers in the scheme.
It found young workers are leading the way in the savings revolution, with more under 30s staying in a pension scheme than other age group.
Minister for Pensions Steve Webb said: “Seeing our largest employers report such low opt out rates bodes well for this ambitious programme, which will see millions more putting money aside for the future.
“Too few people have been saving for retirement. It is all too often something to be put off, something for tomorrow. These figures show that people really value the chance to save into a workplace pension as they know they will also get money from their employer and the taxman too.
“The sooner people start a pension the better, and this report shows that young people are keen to take charge and plan for their future.”
The auto-enrolment scheme started with the largest employers in October last year, and will extend to the smallest firms by 2018.
Automatic-enrolment was introduced to address the problem of millions not putting aside enough for retirement, and the fact that only 1 in 3 private sector employees paid into a workplace pension.
This news comes on the back of figures published last month by The Pensions Regulator that showed over one million workers have been enrolled into a pension.
By 2018 it is expected that between 6 and 9 million people will be saving more into a pension or join a scheme for the first time.
Tim Jones, CEO of National Employment Savings Trust, NEST, said: “Most of our members are relieved they’re getting a helping hand to prepare for the future. But there’s no room for complacency. Many of those being automatically enrolled work extremely hard to make ends meet and finding a bit extra each week is a big ask.
“Starting saving as soon as possible and keeping up regular contributions are the best ways to build up a decent pot.”