Pensions: Low Incomes

(asked on 13th March 2018) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to encourage people from low-income households to save towards their pensions.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 16th March 2018

Automatic enrolment has been a success with 9.4 million workers enrolled into workplace pensions since 2012.

Figures from DWP show that the largest increase in participation has been among eligible low earners, with 63% of these workers in the private sector earning between £10,000 and £19,999 now saving into a workplace pension – an increase of 43 percentage points from 2012. Workplace pension participation among eligible men and women has equalised.

We want to build on the increase in participation. The minimum contributions required under automatic enrolment will increase from the current 2% of qualifying earnings to 5% in April 2018 and 8% in April 2019. This will help to boost pension savings. DWP’s 2017 review of automatic enrolment set out the Government’s ambitions for future reforms to expand the policy.

We recognise the importance of financial resilience and have therefore been working to provide low-income households with products that make it easier for them to build savings outside of a pension as well, such as Help to Save and the Lifetime ISA.

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