IFS To Conduct "major Review" Of UK Pensions Retirement Policy

• Published date: 15 May 2023
• Subject Matter: Employment and HR, Retirement, Superannuation & Pensions, Employee Benefits & Compensation
• Law Firm: Norton Rose Fulbright
• Author: Lesley Browning and Shane O'Reilly

The Institute for Fiscal Studies has called for a "major review of pension provision" after its recent report raised concerns that the majority of workers are saving insufficiently into pensions arrangements and this will adversely impact their living standards in retirement. Among other points, the report found that:

• Although automatic enrolment is deemed a success in boosting workplace pension participation, many savers are contributing low amounts to a pension. For middle earners, 60 per cent of private sector employees are saving less than 8 per cent of their earnings and 87 per cent are saving less than 15 per cent, which is the level the Pensions Commission has suggested should be the target Low contribution rates are more prevalent amongst low earners largely because their qualifying earnings are a smaller share of their total earnings.

• DB pension provision continues to decline and those retiring with DC pension pots will face considerable difficulty and risk in managing their finances through...