DWP backs expansion of auto-enrolment
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “Auto enrolment was introduced in stages in 2012, starting with the largest employers first, medium and then small employers and today includes all employees who meet the eligibility criteria. Since it started, 10.7 million people have started saving for their pensions and it has seen a huge and much needed increase in women and young people being enrolled into a pension. At the time of writing this blog the minimum contributions to the scheme were 8% made up of 3% from the company and the other 5% from the employee. It is now great to see in the article from a number of papers that the Department of Work and Pensions (DWP) have plans to lower the age for workers to be eligible to 18 years old.”
NEWS ARTICLE: DWP backs expansion of auto-enrolment
The Department for Work and Pensions (DWP) has backed plans to lower the age at which workers are eligible for automatic enrolment in a company pension from 22 to 18-years-old. A Private Member’s Bill tabled by Tory MP Jonathan Gullis also seeks to abolish the Lower Earnings Limit for contributions, which currently stands at £6,240. The Bill will not result in any immediate change but will give the Secretary of State powers to amend the age limit and lower the qualifying earnings limit for automatic enrolment at a later date, following consultation. Nigel Peaple, director of policy and advocacy at the Pensions and Lifetime Savings Association (PLSA), said: “The PLSA supports increasing the momentum in automatic enrolment by extending it to workers under age 22 and removing the Lower Earnings Limit so that people save from the first pound of earnings.” Support for the plans comes as the DWP released an analysis of future pension incomes indicating that 2m Britons due to retire this decade will have “inadequate” pension income, increasing to 3.6m in the 2030s.
The Financial Times
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