If you are over 22 and in work then you may be entitled to extra money from your employer
A new government law means that all employers will soon be legally responsible to enrol their staff onto a workplace pension scheme.
The new law means that a small percentage of your wage will be paid into a pension scheme with extra money added on top by your employer. This is then used to build up a pension pot which can be used to pay you an extra income on top of your State Pension when you reach pension age.
So, who’s eligible? The criteria is pretty simple:
- aged between 22 and State Pension age
- earn more than £10k a year
- work in the UK
When your employer mentions auto-enrolment you will have the option to ‘opt out’. This may seem like a good decision when you have a limited budget, but making the small investment each month will make a huge difference in later life.
Getting older and needing to make decisions about a pension can be easily put off, but you aren’t often offered the chance to claim extra money. Stay in and make a difference to your future.
The number of employees automatically enrolled into a workplace pension scheme has passed the 5 million mark
The spotlight shines on staff at the Rose Theatre in Kingston today, as they help celebrate a pensions milestone. The south London playhouse has taken the number of people now automatically enrolled into a workplace pension across the UK past the 5 million mark.
And, along with the dramatic milestone, Pensions Minister Steve Webb announces today that autumn 2016 will see the launch of a new system in which small pension pots will automatically follow workers from job to job.
Automatic enrolment into a workplace pension is an easy, hassle free way for workers to save for their retirement while they are earning. Combined with this, automatic transfers mean that it will soon be much easier for people to keep their savings in one place when they change employers.
Pensions Minister Steve Webb said:
When we came into government, the number of people saving into a workplace pension was low and declining. But our reforms are revolutionising the pensions landscape, making pension saving normal again, and helping millions more people save towards a secure and comfortable retirement.
As people typically have 11 different jobs over their working life, we need to build on the achievements of automatic enrolment with a scheme that enables people to keep their savings in one place, and I am pleased to confirm we are on track to achieve this by autumn 2016.
The 5 million breakthrough – which marks a passing of the halfway point in the roll out of automatic enrolment to the UK’s eligible workforce – is confirmed in figures released today by The Pensions Regulator.
The 5-millionth worker to join the cast of those automatically enrolled into a workplace pension is 23 year old Siobhan Sharp, the Rose Theatre’s marketing officer. She is currently busy promoting the theatre’s Christmas show, ‘The Lion, The Witch and The Wardrobe’.
Siobhan, who has been in her job for a year and a half, said:
I work behind the scenes on productions at the theatre so it makes a change for me to be centre stage as the five millionth person to be automatically enrolled!
I wasn’t saving towards a pension before and hadn’t really given it much thought. But knowing I’m now saving for my future is very reassuring, so I am glad it’s happened.
This month’s automatic enrolment registration report shows that around 43,000 employers of all types, from charities to supermarkets and hospitals to football clubs and theatre groups, have now automatically enrolled their workers.
The roll out began in 2012 starting with the largest employers, and the duties will extend to the smallest firms and new employers by 2018.
The policy was introduced to address under-saving with millions not putting aside enough for retirement, and only 1 in 3 private sector workers paying into a workplace pension at the time.
Figures show that around 9 out of 10 people who have been automatically enrolled have remained enrolled and not exercised their right to opt out of their work-place pension.
The Pensions Regulator’s Executive director for automatic enrolment, Charles Counsell said:
Automatic enrolment affects every employer with workers in the UK. It’s automatic for staff – they don’t have to do anything. But it’s not automatic for employers: they need to take steps to make sure certain workers are enrolled.
Around 43,000 employers have automatically enrolled their staff into a pension and nearly half of them said they wished they had left more time as it took them longer than they thought. We encourage all employers, however small, to learn from the experience of other employers – leaving extra time is better than leaving it too late.
DWP continues to work with stakeholders to develop the details of the automatic transfers – or “pot follows member” – implementation model. The autumn 2016 timetable confirmed today is designed to bring in the scheme as soon as possible while also giving sufficient time for industry to develop the new systems required.
The government will publish further information about the implementation model and timetable in early 2015, ahead of consulting on draft regulations.