A poll of 2,000 working Brits conducted in January by pensions advice specialist Portafina set out to learn how knowledgeable people are of their workplace pension status, their attitude to their workplace scheme and their confidence in auto-enrolment as an initiative to safeguard their financial future.
The research found that only 39 per cent of workers were absolutely sure that they were already auto-enrolled, and only 16 per cent could confirm that they knew how the scheme actually works.
Indeed, 95 per cent admitted that they were unaware of when their employer needed to complete their auto-enrolment by.
In terms of confidence in the government initiative, only 10 per cent said they felt glad that auto-enrolment takes away the hassle of pension planning – indeed 84 per cent said they didn’t feel confident that auto-enrolment alone would ensure they had sufficient pension money for retirement.
However, there did appear to be a slight difference in attitude between age groups – with greater confidence in auto-enrolment among the over-65s, of whom 20 per cent asserted that the initiative is a positive move in their opinion.
“When the government’s review is released I expect it will have a positive outlook on auto-enrolment,” said Portafina managing director Jamie Smith-Thompson, in reference to the Department for Work and Pensions review on the regime due later this year.
“The rollout seems to be going as expected, the opt-out rates have been encouragingly low and government research has indicated the vast majority of small and micro employers are now aware of the policy.
“What this new poll has highlighted is that communication around the benefits and limitations of auto-enrolment needs to be massively improved. Our results show that even though people are enrolling, they aren’t confident in the process or what the results will be.”
Scottish Widows retirement expert Robert Cochran explains the role employers can play in helping employees better understand auto-enrolment: “Beyond the mandatory communications, there’s a benefit in really engaging your workforce with the company pension. It’s often one of the more valuable elements of a reward package, so as well as helping them prepare for a better retirement, you want them to appreciate the provision you’re making.
“Better engagement is something we are passionate about, it doesn’t have to cost much time or money and can be offered in the format that is most effective for your workforce – see what your pension provider or adviser can offer. We have a range of educational content to support employers with this.”