3rd November 2014
The private sector has witnessed hugely significant growth in pension saving since 2012 with salesmen, bar tenders and hotel staff among the workers at the forefront of the new drive.
According to new figures from the Department for Work & Pensions sales and customer service workers have seen a 15% leap in participation, from 27% to 42%, while those working in distribution, hotels and restaurants have seen a climb from 27% to 36%.
Other parts of the economy seeing a big jump in pension saving include energy and water, where the number of staff participating in a scheme has risen from 64% to 74%.
These workers are spearheading a turnaround in what was a decade-long decline in private pension provision, with the government’s automatic enrolment policy a key factor behind the reversal.
Automatic enrolment is being introduced in a phased approach, with every employer in the country due to offer eligible staff a workplace pension by 2018, regardless of how many people they employ. This means that over the next four years, the number of pension savers across all industry sectors to climb further.
So far about 4.7m people have been automatically enrolled and last year the total annual amount saved in private and public sector pensions stood at £77.6bn – up from £73.3bn in 2012
Minister for Pensions Steve Webb said: “Automatic enrolment is transforming the way Britain’s workers see pension saving and, as these industry-by-industry figures show, we’re seeing the change we need across the whole economy. This is another example of action by this government, which is creating a fairer society. We still have some way to go until we’ve completely put right the years of decline in our pension system, but we’re making very strong and steady progress.”
Commenting on latest figures Alan Higham, retirement director at Fidelity Worldwide Investment said: “The figures from the DWP are very encouraging however, there is still a little way to go. The first two years has seen the staging and phasing of the duties among the largest employers, which means that the sternest test; that of the micro employers remains
“However, it is not all doom and gloom as auto-enrolment has ensured that by doing nothing, workers get something – opt-out rates remain low and the consensus in the wider industry and politically continues to hold in support of the programme.”