Standard Life plc expresses concerns over declining trend in 'active membership of workplace pension schemes'

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Category: Financials

Published on Wednesday, 19 September 2012 14:13

Written by Rob Samson

Standard Life plc (LON:SL) has today expressed concern in the downward trend in the active membership of workplace pension schemes here in the UK.

Ann Flynn, Head of Workplace Communications, at Standard Life notes that there has not been a corresponding increase in the number of people saving into a personal pension plan as an alternative.

"Many people simply aren't saving for their older age. And even those who are saving, often aren't keeping track of their savings and saving enough," says Flynn.

This comes as the latest figures from the ONS show that those who are actively saving into a defined contribution workplace pension are now saving more than last year and their employers are investing more on their behalf too.

Flynn says:

"If you're not one of those people making the long-term commitment of saving into a pension, then the longer it's ignored, the bigger challenge it is likely to become. Saving a little now can make a huge difference in the future and it really is the case that every little helps.

"That's precisely why a workplace pension, where, if you're eligible, both your employer and the government top up any investments you make, can make a huge difference over the long term.
 
"In the current economic environment, many people will be finding it tricky to save. If your salary isn't keeping pace with price inflation, you or your partner has lost your job or if you're supporting grown up children who are finding it hard to get work and leave the nest, then it's easy to put your retirement savings to the bottom of the pile. But with the gradual introduction of auto-enrolment from October this year, many more people will be able to take advantage of the great opportunity that a workplace pension gives them. Which has to be good news.

"This month the Department of Work and Pensions is launching a £3.5m TV ad campaign to inform people about auto-enrolment and the benefit of workplace pensions. The campaign features TV Dragon Theo Paphitis and Nick Hewer from The Apprentice and Countdown.  This should really help to raise awareness and encourage those who aren't saving to think again. So I'm hopeful that the figures for next year's ONS report paint a more optimistic picture.

"Obviously with pensions, you won't normally be able to make any withdrawals until you're 55 or older and some people may be concerned about tying their money up. But it would be great to see more people starting a new long term savings habit that is tax efficient, so they can feel much more confident about the future. We all want to be financially secure when we retire and to be able to afford to retire when we want to."