The millionth worker has now been auto-enrolled into a workplace pension scheme under new rules according to the Pensions Regulator.
The phasing in process of auto-enrolment rules began in October 2012, starting with the largest companies. The process is due to complete in 2018 when even the very smallest companies with qualifying workers will be required to comply.
The process of auto-enrolment is designed to actively encourage workers to save for retirement through a work place pension scheme.
Minister for Pensions Steve Webb said:
“Today is a real landmark in this quiet revolution, finally reversing decades of decline in pension saving. This is the biggest change to the pensions system for a century. The money workers save is being matched by contributions from their employers and topped-up by tax relief, helping them put money aside for their retirement, many for the first time.”
According to the Pensions Regulator approximately 11 million are not saving enough to achieve the pension income they want or need for retirement, meanwhile life expectancy continues to rise.
One company among those now auto-enrolling eligible workers into a workplace pension scheme is the Travis Perkins Group, a builders merchant. Worker Kelly Trew, Departmental Secretary of the company said:
“Even though I knew I should be saving for my pension, it was just too much hassle before. So when I started hearing about the new scheme at work, the fact that I would be automatically enrolled into the pension made the decision for me. And now, I'm looking to see when I can put more money into it.”
Auto-enrolment rules apply to different companies at different times according to size.
When they come into force the rules mean that employers will be required to automatically enrol eligible workers into a suitable pension scheme.
“Eligible workers” for the purposes of auto-enrolment are aged 22 or over but are under state pension age, are not already in a qualifying scheme, earn in excess of £9,440, and work (or usually work) in the UK.
Charles Counsell, director of automatic enrolment at The Pensions Regulator, said:
"The Pensions Regulator is delighted to be able to announce a million more people are now saving into a pension. This milestone is a real credit to the hundreds of employers who have helped make the early implementation of automatic enrolment a success."