The value of investments and any income from them can fall and you may get back less than you invested.

Employee workplace pensions in the UK

Share

The Office of National Statistics has produced Employee workplace pensions in the UK: 2018 provisional and 2017 revised results as part of the information uncovered by The Annual Survey of Hours and Earnings.   

Headline findings 

Over three-quarters (76%) of UK employees were members of a workplace pension scheme in 2018, up from 73% in 2017; this is a 29 percentage points increase compared with 2012, when automatic enrolment was introduced.   

The number of employees with defined contribution (pension wealth dependent upon factors such as investment performance) workplace pensions has increased considerably in recent years; in 2018 the proportion of employees with workplace pensions of this type (34%) almost equalled that of defined benefit (which guarantee a specific retirement income 36%)  

Both the public and private sectors saw a rise in the share of employees with a workplace pension between 2017 and 2018, with the private sector seeing the largest growth; 90% of public sector and 72% of private sector employees were participating in an occupational pension in 2018 with the gap between these sectors narrowing.  

In 2018, employees aged outside automatic enrolment age eligibility (less than 22 years or over State Pension age) had low proportions of workplace pension participation (35% or less), whereas approximately 80% of employees within the age boundary criteria were members of their workplace pension scheme.   

Private sector employers with 1 to 99 employees had the largest growth in workplace pension membership between 2017 and 2018, from 51% to 62%; however, this group still had the lowest rate across the public and private sectors.   

The proportion of defined contribution scheme members contributing between 2% and 3% of their earnings rose to 38% in 2018, up from 6% in 2017, while the share contributing less than 2% fell; this is likely to be explained by the phasing of automatic enrolment minimum contribution levels.   

The vast majority (85%) of defined benefit pension members received employer contributions equivalent to 12% or more of their earnings in 2018, while just 8% of defined contribution members received employer contributions of this size: this reflects the legal requirement on employers to ensure defined benefit schemes are funded sufficiently to pay future pensions 

 

Please note that this document was prepared by a third party and as such Brewin Dolphin is not responsible for the content or able to answer queries on the topics dealt with. While we believe it to be correct at the time of writing, Brewin Dolphin is not a tax adviser and tax law is subject to frequent change. Therefore you should not rely on this information without seeking professional advice from a qualified tax adviser, who should also be able to assist you with any questions on the content. 

This document was prepared as a general guide only and does not constitute tax or legal advice.