People over 50 are the most likely to have opted out from their schemes according to government research into auto-enrolment.
An interim report from the Department for Work and Pensions on auto-enrolment sheds light on how the policy is developing.
It is based on two research strands that examine how employers and their staff are reacting to the changes brought by auto-enrolment.
The evaluation of workers’ attitudes comes from qualitative depth interviews with a mix of workers who remained in employers’ schemes after being auto-enrolled.
It also features workers who had chosen to opt out of the schemes after being auto-enrolled.
So far the DWP has interviewed 49 workers, 37 who remained in their employer’s scheme, and 12 who opted out.
The report says: “It is worth noting that nine of the 12 opt outs we have interviewed so far were aged over 50. The most common reason that workers described for opting out was the feeling that they had already built up – or would have built up by the date they retired – sufficient provision elsewhere.
“The most common reason that workers described for opting out was the feeling that they had already built up – or would have built up by the date they retired – sufficient provision elsewhere.”
The analysis of companies is focused on qualitative depth interviews with 70 employers, conducted with at least one person who has been involved in the implementation of auto-enrolment.
Forty-three employers have been interviewed so far and show how companies have reacted to auto-enrolment.
Reacting to the report Quilter pensions expert Ian Browne says: “The latest auto-enrolment report from the DWP makes for comforting reading for policymakers as, among other findings, it shows that while employers are unaware that their pension contributions will jump from 3 per cent to 5 per cent in April, they feel either neutral or positive about it when they are made aware.
“In fact the qualitative research reveals that only a small proportion have opted out and the majority of those were over 50 with a rationale that they had already built up sufficient retirement provision elsewhere.
“However, complacency will be toxic to the policy as relying solely on the power of inertia for the continual success of auto-enrolment remains a real risk when you consider the general low level of pension contributions.