CII Thinkpiece 68

James Lloyd of the Strategic Society Centre and Tim Fassam of the Prudential explore public attitudes to pension saving in the light of the new autoenrollment starting in 2012.

2012 will be landmark year for a lot of things, most notably the rollout of the first phase of auto-enrollment reforms to the UK pensions system. By about 2018, it is expected that all employees in the UK will be auto-enrolled into their employer pension scheme, and the firm will be expected to be required to contribute 4% of the employee's earnings into the scheme. How much of a difference will this make to people's saving habits? Behavioural economic theory tells us that the psychology of auto-enrollment might actually work. But will some people actively chose to de-enroll because of their finances, such as their income being too low, or that their partner is saving, of if they are in mortgage arrears? James Lloyd of the Strategic Society Centre and Tim Fassam from the Prudential summarise the results of their extensive survey research that casts light on these issues.