The new pension auto-enrolment regulations will act to reverse the current slump in pension savings, according to Pensions Minister Steve Webb.
With just two months left to go before the first employers must begin complying with the new regulations, recent research commissioned by the Government has revealed a drop of 15% in the overall amount that employees are putting aside for their pensions.
Meanwhile, only 31% of private sector organisations currently offer any form of pension provision for their employees, representing a fall from 41% in 2007.
Under the auto-enrolment regulations, employers that do not already offer an appropriate pension scheme will be required to enrol all eligible employees into a qualifying scheme and pay a minimum contribution into the fund, unless an employee chooses to opt out.
The scheme is being phased in from October 2012, starting with larger firms. Smaller businesses will be required to comply by 2018.
Commenting on the news, Mr Webb said, ‘Automatic enrolment into workplace pensions will start the monumental shift we need to get millions more people in Britain saving for their retirement’.
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