Malcolm McLean, comments on the ONS figures released today which show the biggest rise in pension saving since records began:
“These ONS figures certainly confirm the early success of auto-enrolment.
However, while this is extremely good news, it is still too early to be 100% certain of the overall outcomes of auto-enrolment. We are now approaching a critical stage where smaller employers are coming on-board. Smaller employers have less resource to comply with auto-enrolment regulations, so we may be faced with much lower success rates than we have seen up to now.
Once the full project is complete in 2018, it will be necessary to review the full results of auto-enrolment at that stage to gain an accurate picture of its success. Thereafter much also needs to be done to encourage higher contribution levels by introducing auto-escalation where necessary.
I also would hope that by then, progress has been made on sorting out the current problems with annuities with a view to ensuring much better outcomes from pensions saving into defined contribution schemes, after all securing better outcomes for pensioners is the whole reason that auto-enrolment was set up in the first place.”