UK. Pensions: More than 1 million workers not participating in workplace scheme
Around a fifth of workers at small medium sized (SMEs) enterprises that are eligible for a workplace pension are not participating in schemes, a new research shows.
Analysis of the Department for Work and Pensions (DWP) data from Broadstone found nearly 1.2 million SME employees could be falling through the “pension accumulation gap”.
It also found pension participation is “stalling” at SMEs, warning employers at these companies to help boost member participation.
Broadstone estimates that around 20% of workers eligible for a workplace pension are not participating at firms with between five and 49 members of staff, equivalent to 803,000 people.
Additionally at businesses with 50 to 249 staff, 12% of eligible employees are not participating.
That marks around 374,000 non-savers, meaning staff are missing out on billions of pounds of “free money”, Broadstone, which provides independent specialist pensions, said.
In total, private sector employers contributed £37.5bn ($45.4bn) to pension savings in 2021 with employees benefitting from a further £7bn via tax relief.
Broadstone warned savers who are not partaking in their workplace scheme risk a lower income and quality of living in retirement.
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