Auto-enrolment for more than six million workers
14 March, 2016
More than six million workers have now started saving into a workplace pension as a result of automatic enrolment, figures from the Pensions Regulator show.
The six million milestone was reached in February, with a total of 6,091,000 people recorded as being in the scheme across the UK.
The figures are taken from compliance forms completed by employers. The regulator also said that, so far, more than 100,000 employers have automatically enrolled staff into a workplace pension.
The scheme started in 2012 with the biggest employers, which tend to have more experience of pensions. It is now being rolled out to thousands of small employers, many of whom may just employ one or two people, such as nurseries, hairdressers, farmers, car dealerships and those employing a nanny or a carer.
Automatic enrolment was introduced to head off fears of a looming old age savings crisis, with concerns that people are living for longer but are not putting aside enough cash for their later years.
So far, the scheme has been successful in getting people into the savings habit, with around nine in 10 employees staying in the pension they have been placed into.
But there are concerns around how smaller employers will cope with the changes.
In January, the Pensions Regulator said it had seen a sharp increase in the number of warning letters and fines being handed out to employers over auto-enrolment.
Compliance notices are often handed out when firms have left their workplace pension preparations too late. The notices contain deadlines which firms need to meet, or they risk getting a fixed £400 fine.
The Pensions Regulator is reiterating its warning that employers need to plan ahead to understand what they need to do and avoid the risk of a possible fine for non-compliance.
Director of automatic enrolment at the Pensions Regulator, Charles Counsell, said: “We are finding a minority of small employers are leaving preparations too late. Don’t get caught out – use our website to nominate a contact. This only takes around five minutes and means we can contact you with all you need to know to get ready.”
To find out how we can help you with your auto-enrolment requirements, please contact us.