Pensions  

Opperman: 12mn people are under-saving for retirement

It called for its competitors to work together on developing an “industry-wide joint pension pot”, which would allow drivers who work across multiple platforms to combine their earnings and reach the minimum auto-enrolment threshold of £10,000.

“To achieve this, we would need firms from across our sector to step up and work together, spurred on by legislative and regulatory changes if necessary,” Uber said.

Section 98 of the Pensions Act 2008 enables the government to extend the definition of a worker. Opperman, however, told Timms that this definition does not currently need amending. 

“We believe the definition of a jobholder in AE legislation is clear, and that there is no need to alter that definition at the present time through use of the powers in Section 98,” Opperman said.

Also responding to the select committee chair, Fuller wrote on August 31 that the government “is committed to exploring how to support self-employed individuals further to save into a pension”.

Fuller pointed to current trials run in conjunction with the Money and Pensions Servicem which signposted self-employed workers not paying into a pension or annuity towards free guidance, along with other workers towards testing “technology-based nudges” and the value of flexible savings mechanisms.

However, he rejected the idea of raising Class 4 national insurance contributions as a substitute for employer contributions for the self-employed. The idea has had backing from Counsell, as well as the All-Party Parliamentary Group on Financial Resilience.

“The government is committed to keeping taxes low to support working people to keep more of what they earn and to encourage individuals to progress, ensuring work always pays,” Fuller said.

“HMRC is not actively considering automatically enrolling the self-employed via the NICs system,” he continued. 

“HMRC systems are not designed to collect or administer pension contributions — it would present a significant challenge as new ones would be required. 

“This would prove to be difficult at a time where the government is already delivering major projects to modernise the administration of tax and pension savings.”

AE has helped reduce the gender pensions gap

In response to Timms’ queries on the gender pension gap, Opperman claimed that auto-enrolment had helped to reduce the gap.

“In 2010 to 2012, the median female pension pot was 38 per cent smaller than the median male pot, and this had reduced to 25 per cent in 2018 to 2020,” he wrote.

The minister noted that a pension wealth gap of around 25 per cent, or £5,800, between males (£22,900) and females (£17,100) for workers aged 16 to state pension age, for those contributing to a pension.