Six years on from the launch of auto-enrolment in 2012, today marks the final staging date for small and micro employers to enrol their staff into a workplace pension.

The government’s auto-enrolment policy has successfully enrolled a further nine million more people into occupational pensions, with the final tranche of the UK’s smaller businesses due to fulfil their duties from today, 1 February 2018.

All employers are legally required to comply with auto enrolment by 1 July 2018.

Following on from today, the next milestone for the policy will be the increase in minimum contributions in April 2018. From 6 April total minimum contributions to workplace pensions will rise to 5 per cent and then again to 8 per cent from 6 April 2019 onwards.

PLSA deputy director defined contribution, lifetime savings and research Nigel Peaple noted: “Whilst it’s important to recognise the hard work that has been put into automatic enrolment, it’s vital we don’t become complacent. There remains an important communications challenge for government, the industry and employers to ensure that people do not opt-out of their scheme when their pension contributions rise in April and that current and future generations continue to strive towards a better income in retirement.”

While the policy has been a success so far, a report by Association of Consulting Actuaries (ACA) warned that the full roll out of auto-enrolment will still leave 12 million workers excluded from the policy, leaving them to rely on the state pension and other benefits in retirement.

In the ACA 2017 Pension trends survey, it emerged that 40 per cent of employees in smaller firms would still not be eligible for auto-enrolment, once the government’s auto-enrolment scheme is fully implemented in 2018.

The report also stated that 57 per cent of employers believe the self-employed should be brought into auto-enrolment, despite this, 44 per cent of employers are reluctant to support the rise in minimum contributions to 8 per cent when it comes into effect post-April 2019.

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