Automatic enrolment (AE) “…continues to help turn around the historic decline in pension provision…” says The Pensions Regulator which has just published its fourth annual commentary and analysis.
The regulator says that AE is continuing to bring more people into workplace pensions and making pension saving now the norm. It also says that two thirds of all employees are now active members of a pension scheme. This compares with just 47% in 2012.
Executive Director for Automatic Enrolment Charles Counsell said: “Our key challenge in the past year has been to engage hundreds of thousands of small and micro employers and to help them prepare for automatic enrolment.
“We needed to target these employers in new and innovative ways. The hard work and commitment of the many organisations who support employers – from trade bodies to employer representative bodies – has made a huge difference.
“The compliance rates achieved have been consistently at the top of our expectations and the savings landscape has been transformed. But we know the job is not yet done and there are still significant challenges ahead.”
A statement from the regulator included key points of the report:
- the number of employers using DC schemes for AE has risen from 86% to 93%. Of those who chose to put their staff into a DC trust scheme, 98% chose a master trust, up from 94% the previous year;
- around half of workers who have been put into a pension have been automatically enrolled into a master trust (three million).
- 97% of workers put into a master trust are in one with master trust assurance;
- there continues to be high levels of awareness among small (95%) and micro (79%) employers due to stage in 2016 and 2017. This increases the closer they are to staging.
- from 16 October to 31 March 2016 185,107 employers used the new Duties Checker tool on TPR’s website;
- as of 31 March, 13,484 of those who completed the declaration brought forward their AE duties.
Commenting on the report, Darren Philp, Director of Policy and Market Engagement at The People’s Pension, said: “Auto-enrolment is a vital part of getting people to save for later life, so it’s reassuring to note that employer compliance remains high.
“Even with the revised numbers we’ve seen from TPR today, the challenge for those small employers still to stage remains demanding. Auto-enrolment isn’t as easy for small employers as it should be and we know that they need help and support to get it right. The industry has a vital role to play in supporting them with their task.”