Record investment as workplace pensions forge ahead, but we must do more
3 min read
The Minister for Pensions and Financial Inclusion wants this country to be the best place in the world to grow old and his programme of reform is focused on achieving just that.
The numbers behind Britain’s retirement saving revolution are striking. Nine out of 10 eligible workers are putting money into a workplace pension. 19 million people are now saving, up from ten million in 2008. And record amounts being invested, with £90 billion pumped in to workplace pensions in 2018.
These fantastic figures, published today, shine a light on the incredible success of automatic enrolment (AE). And if you look behind the raw data, what you see is that this pioneering policy has normalised retirement saving for workers the length and breadth of the country, in thousands of factories, pubs, shops and office blocks. Changing millions of lives.
This has only been possible because of the way employers have embraced AE, and I pay tribute to them for rising to the challenge. What they tell me is that this reform has been easy to implement, and hugely beneficial to staff.
Take Mo Clark, who runs the award-winning Kained Holdings pub chain north of the border, who says AE has helped his workers understand their finances and plan for the future. Or Nicola Shewring, a manager at Thornton & Ross medicines factory in Huddersfield, who thinks boosting people’s pension prospects encourages them to stay loyal to the company.
Mo and Nicola recognise the need to plan for later life. It is, of course, great news that people are living longer, healthier lives but we need to make sure that people have enough money in retirement to enjoy those precious years.
Through automatic enrolment, we’ve made great strides towards that goal. Today’s numbers show that we have helped millions of people to start saving and prepare for their retirement. I am hugely proud of that.
But we must do more. That’s why I’m making further changes - to reshape the pensions industry for the better for savers.
We’re backing pensions dashboards, which will let you see all your pensions in one place online. A long overdue and very exciting change dragging pensions into the digital age. And we’re also introducing an entirely new pension product to the market through Collective Defined Contribution schemes, which have the potential to offer better returns for millions of workers than the options currently available to them.
I want this country to be the best place in the world to grow old and our ambitious programme of reform is focused on achieving just that. Today’s news shows we’re on the right track.
Guy Opperman is Minister for Pensions and Financial Inclusion
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