Almost eight out of 10 employers believe that their pension scheme offers value for money — although only half of their employees (49 per cent) agree.
These findings by Cushon show there is often a significant gap when it comes to how employers and their employees perceive workplace pensions, and the particularly factors that are deemed important.
The survey showed that one of the key issue for employees was how much money their company paid into the scheme. Cushon found that almost half of UK employees (45 per cent) said that a good contribution level from their employer would constitute ‘value for money’ when it came to pensions.
Meanwhile, 35 per cent of employees said a pension that helps them understand what income they are on track for in retirement would also constitute ‘value for money’.
This is higher than the number of employees who consider low costs (34 per cent) and good investment performance (31 per cent) as key indicators of a value for money pension.
The survey comes after the government recently closed its consultation paper on designing a new Value for Money framework for the pension industry.
Cushon’s research highlights the fact that while companies — and the industry — are often focused on price and investment metrics, there are a range of other factors that are important for employees.
Cushon is calling on the government and industry to start listening to employees to drive engagement and ultimately ensure better pensions value for money.
It says doing so could benefit employers from a commercial perspective. While only 27 per cent of employers think pensions bolster their recruitment offering, eight in 10 (78 per cent) workers say they consider a company’s pension offering is important to them when looking for and choosing a job.
Cushon director of policy and research Steve Watson says: “We have always advocated for employers to listen to their employees when it comes to their pension offering. And the findings in our latest whitepaper prove just how important this is when it comes to ensuring employees see their pension as offering value for money.
“Not only is there an opportunity here for employers to aid their employees with saving for later life, there’s also a commercial motive too with many prospective hires looking at a company’s pension offering when picking a new job.”
