Well, I say shocking, but I am being more than a little tongue-in-cheek with that statement because it really comes as little surprise to me whatsoever and I am sure it is of little shock to you as experts in this field.
But I do think what the DWP is discussing in its auto-enrolment evaluation report 2019 is important to consider for a number of reasons.
There are currently 5m people – 15 per cent of the UK’s working population of 32m – who are self-employed, up from 3.3m in 2001, made up of all sorts of people including those who have actually retired but continue to work freelance as consultants, and others working in the so-called gig economy.
Yet the number of self-employed people paying into a pension has decreased from 27 per cent in 2008-9 to just 15 per cent in 2017-18.
The self-employed are in a far more precarious position than their employed counterparts.While these figures are woefully low and clearly show there is a need to encourage the self-employed to plan ahead for their retirement, it is still no surprise to me.
There are a number of suggestions put forward on page 92 in the report as to why these figures have fallen, including the movement of people in and out of self-employment, older workers who may have already retired and are receiving a pension still working on contracts to extend their working life, and more women becoming self-employed.
There is a nod to the effect of the economic downturn and its aftermath, and in my opinion this is likely to have delivered more than a glancing blow.
The self-employed are in a far more precarious position than their employed counterparts.
Self-employed challenges
For example, there is no sick pay, no employer contributing to a pension for you and no redundancy pay if you are out of work.
There are major pluses however, the freedom to work as and when you want, for who you want and to take on or turn down projects at will.
However, and perhaps more importantly given the figures on how the number of self-employed pension contributors have fallen by almost half in just under a decade, there are no pay rises year-on-year as there typically are for employees.
In fact, I remember very well how one of the biggest companies I was writing for back in 2008 at the time of the financial crisis told me it could no longer afford to pay freelancers the same rate as it had been and reduced its rates by one-third.
I could like it or lump it, but I needed the work, so I carried on.
Many things have changed since then, with revenues for businesses recovering for the most part.
Pensions are simply less appealing than perhaps other forms of saving.But have they increased the fees accordingly?
Well, I think you can probably guess the answer to that one.
Now, don’t get me wrong. I love the freedom that freelancing brings, and I appreciate the risks that come along with it, and I am happy to embrace the rough with the smooth.
But it does not take a genius to work out that pensions are simply less appealing than perhaps other forms of saving.
I would like to see the DWP data alongside the Isa savings rates for the self-employed, for example, which provide ongoing access to your funds, even though there may be little difference in the figures.
Many of you reading this will also be self-employed, running your own businesses advising clients and I am sure you are going to be in a similar position.
There are periods of relative feast and famine in the self-employed world.
Sometimes you are so busy you do not know which way to turn and lose out on sleep having worked all night to meet a deadline. Other times you wonder how you are going to make sure you cover the bills.
Effective savings strategy needed
This is the key to all of this.
Often you do not know when your next client or piece of work is coming from, or when it will arrive.
So, forgive us if the idea of putting some money into a product that we can not access again until we reach at least 55 does not overly appeal.
That said, there is a strong argument in favour of putting that money away in a pension, not least because the government will provide tax relief at your marginal rate, giving an additional 20, 40 or even 45 per cent if you are an additional rate taxpayer.
That should not be ignored.
Yet it is such a hard sell to the self-employed who are working to make ends meet that it is difficult to see how to square the circle.
It would be useful if the government worked alongside advisers to come up with a strategy to address the shortfalls in retirement saving, especially because so many are self-employed that they have a real empathy for the position of these potential clients.
As this report has been published now, it will be interesting to see whether there are any plans in the Budget to address this particular issue.
Alison Steed is a freelance journalist
