Figures released this week from The Pensions Regulator show that around 9.9m people have been automatically enrolled into a workplace pension, since the scheme started in 2012.
This is an increase of 1.36m when compared to a year ago. However the number of employees now excluded from AE is growing at a faster rate.
There are now 9.14m employees who are excluded form AE due to low earnings, their age, or the fact they are not a UK national. This figure has risen by 1.67m over the past year.
These figures do not include those who have simply opted-out of joining a workplace pension.
Aviva’s head of savings and retirement, Alistair McQueen says this reverses the trend seen over the last four years.
He called on government to act to address this issue. “AE has been a success so far, in terms of participation. But rather than celebrating what has been achieved to date we need to improve both the participation and contribution level into AE.”
Aviva says it wants to see the minimum age reduced from 22 to 18, and the upper age limit (of the state pension age) removed.
“Aviva calls for the automatic enrolment minimum to be increased to 12.5 per cent by 2018 and for contributions to be based on £1 of earnings, rather than the current threshold of £6,032.
“The government has stated an openness to these ideas, but not until the middle of the next decade. There are a record 32.3 million people in employment today. This huge population cannot afford to wait until the mid-2020s for action.”
