[Press Association] The Government has been urged not to make further delays to its scheme to help tackle the “pensions savings crisis” by automatically enrolling workers into workplace pensions, as it set out its revised timetable for the initiative.
The new system to encourage people to build up a retirement pot starts this October with larger employers, but the Government announced last November that it was delaying enrolment for smaller businessesto allow them more time to adjust.
Under the new timetable, all existing firms will have enrolled their staff by April 2017, followed by all new employers by February 2018.
The Government said the new timeline meant that 70% of people would be automatically enrolled before the next general election.
Workers would automatically be placed into a pension scheme unless they decided to opt out.
Joanne Segars, chief executive of the National Association of Pension Funds (NAPF), said: “The Government needs to stick to the new timetable and avoid last-minute changes that will undermine the success of the reforms. There have been too many delays already.
“These reforms are a once in a generation opportunity to help tackle the UK’s pensions savings crisis. But they require a lot of preparation.”
Age UK’s charity director, Michelle Mitchell, also welcomed the clear schedule, but added: “The timetable must not be allowed to slip further and the Government must now encourage employers to start putting arrangements in place.”
TUC general secretary Brendan Barber described the delays as “deeply disappointing”, adding: “Everyone agrees that we face a pensions crisis, with two out of three private sector workers not in any kind of workplace pension.
“Yet successive governments have delayed the introduction of auto-enrolment and the new system will not now be fully in place until three years after the next general election.”
The level of pension contributions will be phased in over time to help employers and individuals adjust, with full contributions having to be paid from October 1 2018.
Minister for pensions Steve Webb said: “Automatic enrolment will begin on time this October, taking up to 10 million people into pension saving, many for the first time ever, and all employers will be part of it.
“We have done all we can to ease any burden on business the reforms will bring and employers of all sizes now know the date they need to start enrolling their staff.”