Pensions regulator reminds employers of their responsibilities
The Government pensions watchdog has told employers they must not neglect their automatic enrolment responsibilities.
Figures from The Pensions Regulator (TPR) show the overall use of automatic enrolment (AE) enforcement powers is back to pre-pandemic levels following necessary measures introduced to support employers through the early months of the crisis.
The regulator says it has continued to closely monitor compliance and use its powers where necessary to ensure employers remain on track.
Compliance with the law has remained high throughout the crisis, including maintaining pension contributions.
Mel Charles, Director of Automatic Enrolment at TPR, said: “We have been clear with employers throughout the pandemic that they continue to have automatic enrolment duties and the majority have done the right thing for their staff despite the challenges.
“While we introduced measures in the early months of lockdown to allow struggling employers more time to achieve compliance and avoid being unduly fined, the figures demonstrate we have continued to robustly protect savers, using our powers where necessary to protect savers.”
Mr Charles urged employers to ensure they plan ahead, including financial planning, so they continue to make the correct pension contributions for their staff without the need for TPR to take enforcement action.
Contributions heading back to normal
Meanwhile, a new survey shows that employee pension contributions have started to approach pre-pandemic levels.
A report by the Royal London company shows that around three in five employees who reduced or stopped their pension contributions during the COVID-19 crisis have restarted them.
It also highlights the fact that around 15 per cent of staff do not think they are saving enough for retirement.
A survey by the pension provider last year found one in five people who contributed to a pension either reduced or stopped payments, with millennials most likely to pause or slash contributions.
However, one in six still think they are not paying enough into a pension for their retirement.
According to the Royal London survey, the average current pension contribution – not including employer contributions – among those who had restarted or increased their payments was 4.9 per cent of their salary.
Nearly half (47 per cent) think they are paying enough but still need to increase their contributions, and a third (33 per cent) think their contributions are adequate.
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