Kate Smith, Head of Pensions at Aegon, welcomes Stephen Timms MP support for auto-enrolment contributions rising to 12%, following speech at the recent International Longevity Centre (ILC) Retirement Income Summit
“We welcome Stephen Timms’ comments on auto-enrolment and hope that these are a sign that the Labour Party, should it form the next government, will prioritise implementing the 2017 reforms and then look to increase minimum contributions to 12% of earnings. We’re supportive of higher mandatory contributions for most, but believe that more flexible solutions are needed for those on lower pay to stop them effectively ‘over saving’ or cause a spike in opt-outs. This could include side car emergency savings. We support cross industry collaboration with the next government to build a consensus here.
“We have long argued that gig workers should be bought into auto-enrolment, benefitting from an employer pension contribution and we’re also supportive of finding pension solutions for the self-employed.
“We also note Timms’ references to Collective Defined Contribution schemes which may also shed some light on possible future Labour policy here. Labour support would not be surprising bearing in mind the Royal Mail CDC scheme has their union’s endorsement. It will be interesting to see if and where in the priority list the extension to multiple employer CDC schemes and / or decumulation only variants might sit under a Labour Government.”
