Automatic enrolment passes 10 million landmark but are reforms really a “soar away savings success”?

Tom Selby
11 February 2019

·        Official figures from The Pensions Regulator confirm over 10 million people have now been automatically enrolled into a workplace pension (

·        Secretary of State Amber Rudd declares on Twitter that reforms have been a “soar away savings success”

·        Minimum contributions set to rise to 8% of relevant earnings in April this year – unlikely to be enough to provide an adequate retirement income for most

·        Low earning savers in ‘net pay’ schemes still missing out on valuable pension tax relief

Tom Selby, senior analyst at AJ Bell, comments:

“Successive Governments deserve credit for shepherding auto-enrolment to this historic landmark. But the reforms are neither complete nor working perfectly, so to declare them a ‘soar away success’ demonstrates a worrying hubris at the very highest levels of Government.

“Auto-enrolment has undoubtedly been effective in increasing the volume of people saving something for retirement. This is only part of the story, however - most people are still not saving enough and there remains no concrete plan to raise contributions beyond 8%.

“Not all workers are currently benefitting from auto-enrolment either. Those with earnings below £10,000 do not qualify for auto-enrolment (although they can choose to opt-in), while over a million low earners in ‘net pay’ schemes miss out on valuable tax relief.

“The UK’s growing army of self-employed workers also remain outside of scope, with the Government merely committing to using behavioural techniques to boost savings levels in this part of the labour market. It seems highly unlikely this gentle nudge will have anything like the same impact as the shove of auto-enrolment.”

Follow us: