PENSIONS auto-enrolment has been one of the great policy-making success stories of recent times, with more people than ever before now putting aside a pot of cash to help see them through retirement.
As the Office for National Statistics figures show, there was a five per cent increase in the number of people saving via a workplace pension last year, with the bulk of the rise down to the final wave of employers joining auto-enrolment.
This is far from a sign that the looming pensions crisis has been averted, though, with almost half of the working-age population reckoned to be saving too little to be able to enjoy a comfortable retirement.
Worse still, it appears that a proportion of employers are still not complying with their obligation to provide employees with a pension, with the Pensions Regulator reporting an upsurge in the number of fines it has had to issue for non-compliance.
Having used its formal powers on 52,429 occasions in the year to March 2017, the watchdog said that number increased to 102,497 over the 12 months to this March. Over the same period notices issued to employers who persistently ignore their pension duties more than trebled from 2,527 to 7,027 while the number of notices issued to those not paying contributions on behalf of staff rocketed from 1,193 to 4,499.
While the numbers represent a small proportion of the one million-plus employers who should be providing workplace pensions, it is nevertheless a worrying trend. Try telling that to home secretary Sajid Javid, who earlier this week recommended scrapping auto-enrolment altogether as a means of helping businesses in the event of a no-deal Brexit.
Auto-enrolment may not be a perfect system, not least because it has allowed employers who previously offered much higher percentages to slash their contribution rates to bargain-basement levels. But if it was to be scrapped in order to prop up an economy ravaged by the Government’s own hand, it would be a travesty for savers.
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