27 September 2023

Following from the successful Royal Assent of the private members bill in the UK, Northern Ireland are consulting on implementing similar changes to automatic enrolment (AE).

They are seeking powers to reduce the age limit for AE as well as reduce or abolish the lower earnings limit. Currently the proposals are to give ministers the power to implement these changes and further consultation would be required in order to consider the timing and approach.

The current consultation, from the Department for Communities, is an impact assessment of the proposals an dhow they impact pension savings across the country.

There are some interesting figures within that shine a light on how impactful AE is. From 2012 to 2022 the percentage of employees ages 22-29 who had a workplace pension increased from 25% to 72%, whereas the 18-21 year-old group went from 1% to 17%. While this is a big jump, it is still significantly lacking compared to all other age groups which all have an enrolment rate of at least 65%.

When considering the impact that removing the lower earnings limit would have on those with multiple part-time jobs, it is worth noting that women are still far more likely to have a part-time job. The equality impact of allowing savings from the first pound cannot be overstated.

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