Only employees aged 22 or over are automatically enrolled by their employers into a workplace pension under current rules.

However, a major review by the Department for Work and Pensions in 2017 concluded that the lower age limit of auto-enrolment should fall from 22 to 18.

This has not happened and according to insurer Royal London, the DWP has suggested that nothing may happen until the ‘mid 2020s’.

The main barrier is believed to be the Treasury, which is opposed to the extra cost in pension tax relief if the scope of automatic enrolment is extended.

Steve Webb, director of policy at Royal London, said: “Pretty much everyone agrees that enrolling people into a pension as soon as they start work makes sense. It reinforces the message that saving in a pension is the norm when you have a job, and it also reinforces the message that you should start saving as soon as you can.

“Even employers are generally positive, preferring to have a single system for all of their workforce rather than a complex set of exemptions and rules about communicating with the under 22s.  But typical Treasury intransigence means that this sensible proposal – endorsed by another government department – is now in limbo.”

According to Royal London calculations, a typical 18 year-old will end up with a pension pot around £18,000 lower (in today’s money) if they do not start pension saving until they are aged 22. This reflects not only the loss of an employer contribution for four years and the loss of tax relief on contributions but also the loss of investment growth on money invested between age 18 and 22.