FEWER employees decided to opt out of the government’s flagship pensions auto-enrolment scheme than expected, research out yesterday revealed.
Just a 10th of employed workers decided to exit the scheme, which builds a pot with contributions from employer, employee and the government, according to figures from Jardine Lloyd Thompson Employee Benefits (JLTEB).
By contrast, pensions minister Steve Webb and the Department for Work and Pensions thought the opt-out rate could be as high as 35 per cent.
And evidence from early roll-outs such as at the Royal Bank of Scotland, where two fifths opted out, also suggested a high fraction might say no to the scheme.
“[Auto-enrolment] seems to be working. This is an early positive sign that the system the government put in place is functioning,” JLTEB’s Mark Wood told The Times, where the figures were first reported.
The JLTEB figures come from analysis of their own clients who have set up company schemes, in the first six months of the scheme. Up until yesterday, the reforms only affected firms with 10,000 or more staff – from yesterday they were extended to companies employing between 6,000 and 9,999 workers.
By April 2015 all firms with 50 or more staff will be affected and the reforms will hit the last round of employers on 1 February 2018.