From zero to 8m in five years is an amazing achievement. That’s 8m people who have been enrolled into a workplace pension since 2012 thanks to automatic enrolment.
This is nearly the same number of people as the entire population of Scotland and Wales combined.
This means that many millions more will be able to look forward to a more financially secure retirement. And this success owes a great deal to the determination and support of business and industry.
Reaching this place has taken work, whether it’s establishment of pension schemes or communication of the change. But it’s something that businesses have embraced, and compliance rates are high.
In fact during June 2017 alone, 168,000 people gained workplace pensions because of automatic enrolment – the equivalent of one almost every 15 seconds.
But there’s more to do over the coming years as we roll out to small businesses and contribution rates rise. This might lead many to ask "what’s in this for business?" But the experience so far has shown that automatic enrolment is as a good thing for the business itself.
Staff who feel supported by their employer are engaged and committed, and what better way to demonstrate that your employees are valued than showing you care about their future by providing them with a workplace pension.
Crucially in the current climate of record employment a workplace pension can also help recruit staff. With around 770,000 vacancies in the economy at any one time at the moment we know that recruiting the right people is a priority for many businesses. A good pension can be a meaningful part of an employment package and one that we should be focusing on to attract applicants.
Far from done
Of course our work here is far from done. As many have highlighted, minimum contributions, and where the self-employed fit in does need to be considered. This is why we have launched a review, bringing together experts from business and the industry such as Chris Curry, director of the Pensions Policy Institute, Jamie Jenkins, head of pensions strategy at Standard Life and Ruston Smith, trustee director at Peoples’ Pension, to help us look to the future. The review will report back later this year and will help us take the policy to the next level.
This ambitious agenda of helping workers save for retirement would not have been possible without the support of business.
This has been a joint success for government, industry and the employee. We could not have done it without business support and enthusiasm and all the businesses involved so far should look at today’s 8m figure with great pride.