Around 9 million pension savers will save for the first time or save more, due to reforms of workplace pensions with the introduction of automatic enrolment, around one million more than previously forecast.
Latest evidence on opt outs has resulted in the Department for Work and Pensions (DWP) greatly reducing its forecast from a cautious initial estimate of around 30% to just 15%, for the lifetime of the programme. This equates to around a million more people saving on top of the millions already predicted.
New DWP research has revealed that opt outs among the biggest firms stands at 9% to 10%.
Minister for Pensions Steve Webb said:
Automatic enrolment is proving significantly more successful than previously predicted. With opt outs remaining low we now expect 9 million people will be newly saving or saving more as a result of our reforms.
Our reforms to pensions are working and have already proved a success. Now this is an extra million savers who will be helping to secure a better future for themselves and their families.
Ensuring people can plan for their retirement is crucial to building a stronger economy.
Figures from The Pensions Regulator, released yesterday, show 3.2 million have been enrolled into a pension and nearly 11,000 employers have now registered.
The department’s research also showed that the percentage of private sector employees who are members of a pension scheme rose from 26% in 2011 to 35% in 2013.
Read the research on ‘Employers’ pension provision survey 2013: preliminary findings’.
Automatic enrolment started in October 2012 and will roll out to all employers through to 2018.
At the time of the research only 2% of all private sector organisations had passed their staging date but they account for almost a third of all private sector employees.
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