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Part-time workers penalised

The latest declaration of compliance report produced by the Pension Regulator is a timely reminder of the shortcomings of auto-enrolment as we head towards 2017 and its inaugural review.

  • Of employers to have adopted auto-enrolment, 6,155,000 workers remain on the sidelines
  • This equates to more than 1 in 4 workers
  • In the main, those earning under £10,000 per annum – effectively those working part-time - are missing out
  • 265,000 staff have been swept back into pensions as part of their employer’s 3 year re-enrolment, representing just 2% of total workers

Nathan Long - Senior Pension Analyst at Hargreaves Lansdown:

"A sizeable chunk of employer workforces are being frozen out of saving for retirement and that is before we even begin to address the issues afflicting the self-employed.

In the main, part-time employees are missing out which tends to discriminate against women who are more likely to take these roles. The demands of modern living mean the flexibility of both self-employment and part-time roles will continue to grow in popularity. Failure to incorporate these groups into pension saving could spell disaster for an otherwise successful policy.

Priorities for the Government’s 2017 auto-enrolment review should be to lower the level of earnings at which employees are put into a pension and to include the self-employed in automatically saving for retirement. A reduction in the level of earnings needed to be auto-enrolled to that of the New State Pension would be sensible."

NOTES TO EDITORS

Globelynx and ISDN ready

Hargreaves Lansdown is equipped with a live in-house broadcast camera via the Globelynx network and has an ISDN line available for radio interviews - 0117 934 9006. To arrange an interview with a Hargreaves Lansdown spokesperson please contact the person you wish to speak to directly using the contact details above, or call Globelynx on 0207 963 7060 or email globelynx@globelynx.com.