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Automatic Enrolment Report 3: How will automatic enrolment affect pension saving?
This report is the third in a series of reports on automatic enrolment. It analyses the potential effects that employee and employer responses to automatic enrolment could have on scheme membership and the total value of assets in private sector workplace pension schemes.
This report was sponsored by Legal and General and the analysis uses data provided by three automatic enrolment scheme providers (Legal & General, NEST and The People’s Pension), one employee benefit consultant (JLT), and the DWP, on their experiences of implementing automatic enrolment, covering over 2.6 million of the individuals who have been automatically enrolled.
The research series is being funded by a consortium or organisations including the Association of British Insurers, the Defined Contribution Investment Forum, the Department for Work and Pensions, the Institute and Faculty of Actuaries, Legal and General, The People’s Pension and Prudential.
Chapter one describes the main aspects of automatic enrolment into workplace pensions in the UK. It then explores the factors that could affect total levels of pension saving such as the decision of employers to contribute at the minimum legal level or above and workers’ decisions about whether or not to opt out.
Chapter two explores the effects that different scenarios of member response to automatic enrolment could have on the number of people saving into workplace pensions and the value of private sector workplace pension scheme assets. The chapter also shows the distribution of members between existing provision, and new DC schemes, including multi-employer schemes.
Chapter three explores the effects that different scenarios of employer response to automatic enrolment could have on the value of private sector workplace pension scheme assets.
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