17 October 2023
The Pensions and Lifetime Savings Association has conducted research around their plans for pension reforms. These reforms are proposed to ensure that savers see adequate living standards when saving for their retirement.
In the findings 53% of the 1,600 respondents agree that automatic enrolment contributions should increase from 8% to 12 over the next decade. Additional 46% of respondents think employees and employers should be paying the same amount, with 42% thinking the employer should contribute more.
PLSA have released their updated proposals under their ‘five steps to better pensions’. They are:
- set new goals for the UK pensions framework: adequate, affordable and fair
- the state pension should protect everyone from poverty and its value should be maintained by keeping the Triple Lock
- more people should be saving into a workplace pension and at higher contribution levels. Over the next decade contributions should rise gradually from 8% to 12%. While employees should only be required to put in 1% extra, we believe employers should put in 3% extra, with the result that by the early 2030s each will be paying an equal share of 6%
- additional help should be given to under-pensioned groups such as women, the self-employed, gig economy workers and others. Some of these will require changes to automatic enrolment or other interventions
- the pensions industry and employers should take action to help people engage with pensions, receive higher contributions, or get better pension outcomes. This includes maintaining initiatives such as the Retirement Living Standards and the Pay Your Pensions Some Attention campaign.
It is always worth thinking about general perception and attitudes of employees when considering recruitment and retention. If a combined 88% of respondents believe that workplace contributions should be shared equally or exceeded by the employer, then this could be utilised by your organisation.
The CIPP support strengthening pension contributions and ensuring that everyone has good living standards in retirement. However, we also understand the burden that this can put on employers as well as the impact increased contributions can have on employees, especially during such hard financial times.
Information provided in this news article may be subject to change. Please make note of the date of publication to ensure that you are viewing up to date information.
