9 million newly saving or saving more in pensions

The Momentum UK Team 17 April 2014

Around 9 million will start saving or will be saving more into their pension, according to recent estimates by the Department for Work and Pensions (DWP).

Due to the workplace pension reforms and the introduction of automatic enrolment in 2012, around one million more people than was previously forecast will be saving for the first time or saving more into a pension.

Qualifying workers will be automatically enrolled into their workplace pension schemes, but will have the option to opt-out. The DWP have halved their predicted opt-out percentage from a cautious initial estimate of 30% to 15% for the lifetime of the automatic enrolment programme, based on the latest opt-out numbers.

New DWP research also places the number of opt-outs amongst the biggest firms as between 9% and 10%.

The roll-out of automatic enrolment to private sector employers is set to continue until 2018. The research also indicates that the percentage of private sector employees who are members of a pension scheme rose from 26% in 2011 to 35% in 2013. Over 3.2 million have now been enrolled into a pension scheme, and almost 11,000 employers have now registered.

Minister for Pensions Steve Webb commented on the figures:

“Automatic enrolment is proving significantly more successful than previously predicted. With opt outs remaining low we now expect 9 million people will be newly saving or saving more as a result of our reforms.

“Our reforms to pensions are working and have already proved a success. Now this is an extra million savers who will be helping to secure a better future for themselves and their families.

“Ensuring people can plan for their retirement is crucial to building a stronger economy.”