UK Population Not Saving Enough For Retirement Figure Out By Millions
20 September 2012 (PLANSPONSOREurope.com) – UK Government figures for the number of people not saving enough for retirement could be out by as much as 9m people, analysis shows.
On the day auto-enrolment was officially launched in the UK, the Department for Work & Pensions released figures claiming that 11m people eligible for the policy are not saving “enough” – the number not paying into auto-enrolment compliant schemes.
But according to actuaries Punter Southall there are many million more who are in such schemes, but who are not going to save an adequate sum for retirement because they are not making large enough contributions.
Chairman Stuart Southall told PLANSPONSOR Europe the total figure for private sector employees with either no pension or DC schemes into which they pay too little is “15m-20m”.
“I am not saying they could save more because maybe they don’t have the financial means but the reality is they are not saving enough,” he added. “They don’t understand they are not saving enough.
“It doesn’t have to be through a pension. It is just about accumulating enough assets for your retirement.”
UK Pensions minister Steve Webb said auto-enrolment, which will see 6m-9m people get pensions for the first time, is “the biggest boost to pensions for over a century”.
And he dismissed rumours plans for a £140 flat rate pension will be shelved or put back.
The government has been accused of planning to delay and water down its ongoing welfare bill, on the back of strong criticisms in recent weeks.
But Webb told a Punter Southall conference in London: “As you know we have planned a single, simple, decent state pension in terms of a flat rate just above the basic means test, which is in today’s money is roughly £140 - slightly more. That is happening.”