doc

NEW figures show the number of people saving into workplace pensions continues to rise and has increased by 4.4 million since 2012.

A key reason behind this huge rise is the number of people being automatically enrolled into workplace pensions.

Recent analysis by the Institute for Fiscal Studies shows that between 2012 and 2015, 95 per cent of the rise in private sector membership was the result of automatic enrolment.

This policy – which was launched in 2012 and will be fully rolled out by 2018 – has arrested the decline in pension saving during the past decade.

With millions of people set up in a workplace pension, workers can benefit from years of saving which will give them greater financial security in retirement.

Minister for Pensions, Richard Harrington said: “The report demonstrates how automatic enrolment is helping millions of working people save for their retirement, so they can look forward to extra income on top of their State Pension and a better standard of living as a result.

“It is clear automatic enrolment is playing a key role in shaping the retirement landscape for generations to come. However I want to build on this success and will be looking at how we can get even more people saving, and saving more.”

In 2015, the annual total amount being saved by employees was £81.8 billion, an increase of £1.4 billion from 2014 and a further £7.1 billion since 2012.

The amounts people are saving are set to increase as minimum contribution rates are scheduled to rise from two per cent to five per cent in April 2018, and from five per cent to eight per cent in April 2019.