Nine major UK pension firms and trade and consumer bodies have written a letter to the Chancellor to urge the government to widen access to auto-enrolment to younger people, part-time workers, and those on lower incomes.
In the letter, Onward and the nine signatories told the Chancellor that it was “time to level up pensions for everyone”.
The Pensions & Lifetime Savings Association (PLSA) has since confirmed to IPE that it also supported the appeals in the letter, which are in line with its own plea for the government to “level up” UK workplace pensions, a response to the government’s “levelling up the United Kingdom” white paper.
Co-ordinated by think tank Onward, the letter comes after pensions minister Guy Opperman last week said the government remained committed to the 2017 auto-enrolment review, and would “in the fullness of time, bring forward or support legislation to take this matter forward”.
Many in the UK pensions industry would like the minister to provide a firm timetable for changes. The government has previously committed to reform “by the mid-2020s”.
In the letter, the pension firms and trade bodies proposed a reduction in the age threshold for auto-enrolment from 22 years old to 18 years old, and abolishing the lower earnings limit of £6,240 (€7,551). The changes should be introduced in a phased manner, they said.
They urged for ministers to provide government time to consider reforms to auto-enrolment in the third session of this parliament.
Richard Holden, MP for North West Durham, introduced a private members’ bill to extend auto-enrolment to younger and low-paid workers but it has not yet received its planned second reading.
The letter was signed by representatives of The Investing and Saving Alliance (TISA), the Association of British Insurers (ABI), Aviva, Hargreaves Landsdown, Scottish Widows, Just Group, NOW: Pensions, Legal & General Investment Management, and Standard Life.
At Standard Life, Colin Williams, managing director of pension and savings, said the company fully supported the Onward letter’s calls for reducing the age at which people benefit from auto-enrolment and removing the lower earnings limit, but “would go further and urge the government to remove the earnings trigger which is currently set at £10,000 as that would bring more people, especially women and part time workers, into workplace pensions”.
Last month Opperman revealed the government had opted to keep the earnings trigger for auto-enrolment at £10,000 for 2022-23, and to keep the qualifying earnings bands at their current levels of £6,240 and £50,270.