Despite more than 9 million people being auto-enrolled into pension schemes since 2012, their attitude to saving has remained unchanged, data from the Office for National Statistics (ONS) shows.
According to figures out today (1 August), 63 per cent of eligible employees were aware they had been automatically enrolled into a workplace pension.
Among the ones who reported they had not been automatically enrolled into a workplace pension, 91 per cent were already members of a scheme, and therefore would not have been affected by the legislation, which started with large employers in 2012.
But despite auto-enrolment being considered by some experts as a "quiet revolution" to employees’ pension savings, the ONS data shows little has changed in terms of people's attitudes to pension saving.
Since 2012, employer pensions are seen as the safest way to save for retirement and this perception has hardly shifted since – rising from 39 per cent of people in 2012 to 41 per cent in 2017 - still a minority of people.
People's confidence in their understanding of pensions has also not visibly benefitted from the reforms, which stood at 43 per cent in 2012 and rose a mere 1 percentage point, to 44 per cent, in 2017.
Helen Morrissey, pension specialist at Royal London, said there was still a "long way to go in terms of raising awareness" about pensions.
She said: "While getting people into a pension is an important first step, it is also vital to realise that building a decent retirement pot means being engaged with the process and taking informed decisions at the appropriate times."
Alistair McQueen, head of savings and retirement at Aviva, said today’s figures "strengthens Aviva’s belief that the auto-enrolment minimum contribution needs to be boosted to 12 per cent by 2028".
He said: "Relying on engagement alone to boost saving is set for failure. The government’s responsibility and our industry’s responsibility is to help the public achieve their financial goals in retirement."
He said the public was playing its part by staying enrolled in workplace pensions.
"The ball is back in the government’s and our industry’s court to take the next step towards higher minimum contributions," he added.
Auto-enrolment minimum contributions will increase to 8 per cent in 2019, after increasing to 5 per cent this year.
Martin Bamford, chartered financial planner and managing director at Informed Choice, argued "public trust in pensions is low because the government keeps on moving the goal posts".
He said: "It’s no surprise that people don’t trust pensions to provide for them in retirement, when there is incessant tinkering with tax relief during most budgets.
"Increasing the minimum contributions for auto enrolment would provide a stronger nudge for people to save for the future, as long as the option to opt-out remained to allow some choice in the matter."
maria.espadinha@ft.com
