Pension reform and auto-enrolment

21st February 2018

Pension reform has been a long term struggle for Governments of all colours. Since my first election, I have seen Ministers struggle to win hearts and minds of the public to make provisions related to their retirement plans.

I have expressed on many occasions my unease about certain provisions which disproportionately affect my constituents but in this column I want to take a moment to recognise a policy which has benefited millions of people and has allowed them to make secure long term plans earlier than before.

Saving for old age is often not viewed as a pressing concern for the young or those who do not have enough to make ends meet. It is often the most vulnerable in our society who suffer.

Pensions are a long-term investment and require long-term policy-making.

By introducing ‘automatic enrolment’, the Coalition Government transformed the way people save for retirement. The policy requires employers to enrol all eligible staff – those aged between 22 and the state pension age, earning £10,000 per year or more– into a workplace pension.

Now in its fifth year, it has been very successful in reversing the decade-long downward trend in pension saving; prior to its introduction, between 2003 and 2012, there was a downward trend in workplace pension participation, from 12.3 million eligible employees to a low of 10.7 million.

I was alerted this week to newly published figures which show that 8,000 more people in Torridge and West Devon are now saving more for their retirement.

Nationally, the reforms to workplace pensions have resulted in 9 million more people saving for their retirement.  The biggest beneficiaries have been young people, women and those who earn the least in the workplace.

Across the South West alone, the policy has seen 80,730 more people in work saving for a life after work.

The world of work is changing, so it is only right that pension saving does too. Auto-enrolment was introduced so that more families can save for retirement and plan for the long-term with the security of a pension.

For a whole generation, workplace pension saving is now the new normal, but there’s more to do to help more people than ever before build an enjoyable and secure retirement. Our mission now must be to make sure the next generation of younger workers have the same opportunities.

 

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2019

Saturday 2nd March
Holsworthy, Tavistock

Saturday 23rd March
Bideford, Torrington