Pensions with very low employer contributions more than treble in a year, says TUC

date: Friday 11 December 2015
embargo: For immediate release

New figures released today (Friday) from the Office of National Statistics show that the proportion of pensions with very small employer contributions has more than trebled in the last year. 

The proportion of active members of occupational Defined Contribution pensions with employer contribution rates of “Under 4%” increased from 22% in 2013 to almost 69% in 2014. 

This is the result of many employers only paying the legal minimum contribution rates as more employees are automatically enrolled in pension schemes.

Commenting on the figures, TUC General Secretary Frances O’Grady said:

“The surge in employers paying only small amounts into staff pensions risks undermining the successful roll-out of auto-enrolment. 

“It is good to see so many more people saving into a pension, but it would be a betrayal if many end up with insufficient sums for a good standard of living in retirement. 

“Effective pension saving requires a partnership between employees, employers and the state. These figures show the need for the government to set out a clear path to raising minimum contribution rates to ensure workers have a decent pension.”

NOTES TO EDITORS: 
- The ONS release can be found here: bit.ly/pensioncontribs 
- All TUC press releases can be found at www.tuc.org.uk
- Follow the TUC on Twitter: @The_TUC and follow the TUC press team @tucnews

Contacts:
Alex Rossiter  T: 020 7467 1285  M: 07887 572130  E: arossiter@tuc.org.uk
Tim Nichols  T: 020 7467 1388  M: 07808 761844  E: tnichols@tuc.org.uk
Michael Pidgeon  T: 020 7467 1372  M: 07717 531150  E: mpidgeon@tuc.org.uk 
Elly Gibson (Mon to Wed)  T: 020 7467 1337  M: 07900 910624  E: egibson@tuc.org.uk
Kay Atwal (Wed and Thur)  T: 020 7467 1385  M: 07941 547469  E: katwal@tuc.org.uk