Deloitte comments on introduction of auto re-enrolment

Andrew Power, investment management partner, Deloitte:

“October 1st 2015 marks the three year anniversary since the introduction of auto-enrolment in the UK. It is also the first time that auto re-enrolment comes into force, affecting an average of 9% of workers* that chose to opt out the first time around. For these individuals, today’s policy could see them return to a pension scheme.

“The pensions landscape has changed considerably since 2012, with pensions freedom and flexibility most notably shaking up the system. That said, the challenge of encouraging savers to save still remains. Recent research from Deloitte found that the annual savings gap for the total population will reach £350 billion by 2050, dwarfing recent, more conservative estimates.

“Auto re-enrolment today, in the backdrop of the pensions tax relief consultation, will attempt to close the current gap by putting the onus back on to the individual. However, we will need to go beyond this to demystify pensions and incentivise individuals to save. This could be with better consumer communication supported by technology development expected by younger savers, more products that are not only more flexible but also more personalised, and for the fragmented industry itself to make better use of information aggregation.”

End

Notes to editors

About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.

Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.

The information contained in this press release is correct at the time of going to press.

Member of Deloitte Touche Tohmatsu Limited.

*Source: DWP, Automatic enrolment opt out rates: findings from research with large employers