Less than 10% of workers are opting out of auto enrolment pension schemes
According to an announcement from the Department for Work and Pensions (DWP) over 90% of people who have been automatically enrolled into a workplace pension scheme have not opted out.
Auto enrolment, the main component of the government’s workplace pension reforms, means that employees who are eligible must be automatically enrolled onto a workplace pension scheme. Employees have the option to “opt-out” of the scheme if they do not wish to contribute, but these figures show that most are choosing to stay in.
DWP surveyed the 50 biggest employers who have already begun complying with auto enrolment and found that on average only 9% of people had chosen to opt out. This figure is much lower than the initial estimate of a 30% opt-out rate.
These figures, although early, are a great indication that auto enrolment is meeting its objectives. The reform was introduced to encourage people to plan for retirement, as people are living longer but saving less.
Pensions Minister Steve Webb commented on the figures saying: “Seeing our largest employers report such low opt out rates bodes well for this ambitious programme, which will see millions more putting money aside for the future.”
You can view the full report on the DWP website.
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