Some of the UK pension industry’s big beasts have joined forces to demand an expansion of auto-enrolment to capture young people, part-time workers and those on lower incomes.
Master trust Now Pensions and the Association of British Insurers are among nine organisations to have lobbied chancellor of the exchequer Rishi Sunak to follow through on recommendations made by the Department for Work and Pensions in 2017.
Employers must currently enrol into a pension scheme any staff aged between 22 up to the state pension age, and earn more than 10,000 a year, 833 a month, or 192 a week. Both employers and employees must pay into the scheme.
The nine pension companies, along with think-tank Onward, have called for a reduction in the age that people can start to save via auto-enrolment to 18 from 22 years old.
They have also urged Sunak to phase out the 6,240 lower earnings limit. This is the earnings threshold that allows employees to qualify for certain state benefits, including the basic state pension.
The letter, whose signatories also include Standard Life, Legal & General Investment Management and Scottish Widows, called for the widening of auto-enrolment by the mid-2020s. The Treasury declined to comment.
These proposals fall in line with the DWP’s own 2017 report, which recommended auto-enrolling workers from the age of 18 and abolishing the low-earnings threshold.
Expanding auto-enrolment would help those on the national living...
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