Pension auto-enrolment has got off to an “excellent start”, according to the executive director of the Pensions Regulator, Charles Counsell, in the light of new research showing that far fewer people than expected have opted out of the scheme.
Thousands of small- and medium-sized enterprises (SMEs), including numerous Umbrella Companies, are facing their staging dates over the next few months. The new study by the research firm Futures Company and pension provider Nest suggests that the recession has fundamentally altered the way in which consumers are handling their finances, with many more people than expected willing to make the monthly savings required by auto-enrolment.
Since the scheme began with larger firms in October last year, the research notes, over 1.6 million employees have been auto-enrolled onto workplace pensions. The new research polled a sample of people currently awaiting auto-enrolment onto workplace pensions; 61% said they planned to remain in the scheme, which is a significant rise on the 47% when the research was last conducted in 2011. The number of people opposed to the scheme has also tumbled over the same period, falling from 27% to just 18%.
The research also reveals that the number of people remaining in schemes after auto-enrolment is considerably higher than many pundits had forecast, at around 90%.
The study suggests that people are handling their money differently in the wake of the recession, with 57% now saying that they would never spend as freely today as they did before the recession struck, up from 43% in 2010 and 48% in 2012.