Saving for the future
Pensions This year marks ten years of automatic enrolment (AE), an initiative that’s changed the pension and employment landscape considerably. As the future looks to bring us additional scheme types (collective defined benefit) and new innovations for savers (pensions dashboards), it’s important to take stock of the pension offerings of companies today. Like last year, employers have an average of 80% of their workforce enrolled into a pension scheme. Again, salary sacrifice was the most popular contribution type on offer, with 66% of employers offering it, this was up from 47% last year. This is unsurprising, given the benefits for both employees and employers this arrangement can provide. For those that don’t currently operate a salary sacrifice scheme, the CIPP would encourage employers to explore the reasons why. National Insurance savings could be had by both employees and employers, which may encourage those that opt out to continue with the contributions. However, the CIPP recognises that NMW compliance is a consideration when introducing this type of scheme.
Contribution arrangement types
70%
60%
66%
50%
40%
46%
30%
29%
20%
10%
0
Salary sacrifice arrangement
Net pay arrangement
Relief at source (RAS)
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