Auto-enrolment hit a record high in 2016, with the number of policies reaching 7.5 million, an increase of 11 per cent on 2015, and equivalent to 725,000 policies, the Association of British Insurers has said.
Commenting ABI director of policy, long-term savings and protection Yvonne Braun said: “The success of automatic-enrolment shows how the power of policy can benefit society in the long term. Our industry constantly adapts and evolves its long-standing products to meet our customers’ changing needs.
“But we cannot let our guard down now. We urge the government to widen the auto-enrolment net to help even more people start saving now for their future.
“We also know 8 per cent of a proportion of earnings is not enough for most. We need the government to set out clear plans to push up contributions after 2019, and to explore how best to engage all workers with saving and planning for their retirement. Pensions dashboard services should have a key role here.”
As people build up many pension pots with different providers as a result of auto-enrolment, the ABI noted the increasing need for a pensions dashboard style service to enable savers to get an overview of all their pension savings online. The technology to support such a service is near completion but a regulatory framework and government legislation are required to allow a comprehensive service to be rolled out to the public.
In August, the ABI revealed the ABI implied the pensions dashboard may not be rolled out to the public without a change in law, which makes the provision of data compulsory from providers and schemes.
Furthermore, the ABI also warned that despite contribution levels rising to 8 per cent in 2019, it will still leave the majority of savers without enough money for retirement. It is important that the government ensures all areas of the workforce benefit from auto-enrolment, in particular part-time employees, people with multiple jobs and the self-employed, the ABI said.
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