92% of employers say pensions attract and motivate staff
Some 92% of employers believe that workplace pensions attract, retain and motivate workers, according to research by the Confederation of British Industry (CBI) and Mercer.
The report, A view from the top: CBI/Mercer pensions survey 2015, which surveyed 166 organisations, also found that 96% of respondents believe that there is a strong business case for providing a workplace pension.
The research also found:
- 64% of respondents say employees generally make the right decisions when it comes to their pensions, while 36% disagree.
- 52% of respondents want regulatory stability around pensions to be a priority for the government, and 20% want the tax relief framework to be re-examined.
- 82% of respondents do not think that reviewing minimum pension contribution levels should be a key priority for the government.
- Almost half (48%) of respondents say that the pension freedoms that came into effect in April 2015 have made defined contribution (DC) pensions more effective in ensuring employees can afford to retire, yet 18% disagree.
- Nearly two-thirds (65%) of respondents report that defined benefit (DB) pension schemes have had a negative impact on investment.
- 82% of respondents say DB costs are impacting their bottom line.
- Nearly half (46%) of respondents believe that some employees would cease saving into pensions if the pensions tax relief framework changes.
Neil Carberry, director of employment and skills at the CBI, said:
Recent regulatory changes, coupled with auto-enrolment and state pension reform, mean UK business leaders now crave stability. Businesses want to focus on ensuring employees are making the most of what’s on offer, but there is clear concern about regulatory changes eroding incentives to save, which must be avoided at all costs.
Fiona Dunsire, chief executive officer at Mercer, added:
The focus now should be on enabling business to address the challenges of an ageing workforce and the urgent need to save more for retirement. It is vital the UK’s approach to pension tax relief remains unchanged as it is important to avoid imposing unnecessary cost on businesses.
Frank Oldham, senior partner and global head of defined benefit risk at Mercer, said:
Despite increased contributions, anxiety over funding levels persists and we have seen a surge in organisations looking to reduce risk in their DB schemes.
Petaurum Solutions Comment
With Pensions Auto Enrolment becoming a reality for many small businesses over the coming months, getting the right pension scheme in place and educating employees to the benefits of saving for the future will become a key focus. If you are looking for a cost effective Pensions Auto Enrolment solution that will balance affordability with quality then we have a range of solutions to fit not only your budget but also your need. Whatever you opt for, you will benefit from a Defaqto 5* rated Master Trust scheme giving both you and your employees peace of mind and a wide range of investment options. For more information why not visit our Pensions Auto Enrolment pages on our website, or even better contact us for a chat about your requirements.
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