Pension Commission to look at why four-in-ten fail to save enough

If the government is not trading to increase retirement savings, people who retired in 2050 will be worse than retirees today.

The Ministry of Labor and Pension (DWP) revives the Pension Commission, which declared about 20 years ago, to look at how to handle the problem.

DWP said that almost half of the working age adults did not put money for a special pension, where low -winners and self -employed people are more likely to save pension.

The departure is worse among women and some ethnic groups, just one quarter of Pakistani or Bangladesh savings in a special pension.

The department said that people who received their pensions after 25 years after 25 years were set up to 800 £ or 8% worse than today’s colleagues.

Instead of starting a new commission from scratch, the government said it revived the “turning point” Turner Pension Commission, which was reported under the last workers’ government in 2006, and led to an automatic registration for retirement savings. As a result, 88% of the appropriate employees save 55% in 2012, he said.

Despite this progress, DWP said that the new analysis reveals the “sharp” findings of the following:

• More than three million self -employed workers do not enter the pension
• In the private sector, only one quarter is entering a low -winning pension
• Pakistani or Bangladesh heritage only one quarter of savings

The analysis also found 48% gender difference in private retirement de foot among the people who are currently retired, and a typical woman is a man who gets £ 200 from £ 100 a week and gets £ 200 from private pension income per week.

The Commission has not been designed to directly address the problems of the cost of the state pension.

Recent reports have shown questions about the purchasability of the “Triple Lock” introduced in 2010, which guarantees that state pensions will increase as average wages, inflation or 2.5%each year.

As the population gets older and people live longer, the cost of this policy will grow significantly.

It is estimated that the cost is three times higher than the original predicted after high inflation for consecutive years at the end of a decade, and then strong wage growth.

Instead, the reconstructed commission, which will report in 2027, will look at the savings in the private sector pensions.

Some will bring together trade unions, employers and independent experts in the original commission. It will look at what prevents people from putting more in their retirement pots and aim to create a national consensus on future strategy.

Kate Smith, the President of the Pension Company Aegon Pension, called on the commission to make “brave, brave and probably unpleasant suggestions”, including “significant increases” in their contribution contributions after 2029.

Paul Nowak, the Secretary General of the Trade Union, described it as “a vital step towards”.

“Everyone deserves dignity and security in retirement, but now many workers – especially the private sectors – will find themselves without enough to deal with.” He said.

Caroline Abrahams, the director of the charity of the Age UK, said that it is “extremely important” to take into account the role of special savings because it has left many retirees to meet the end of the existing system, although the state pension provides retired income.

“I hope this can be prevented in the future, and especially low -paid women and low -income self -employed people, including disadvantaged groups, can help to put aside the money when they are appropriate.” He said.

Catherine Foot, Director of Standard Life Center for the future of retirement, said that 17 million people did not save enough to achieve their pension.

“The next twenty years, the effects of the savings crisis will really begin to bite.” He said.

It was very important for the commission to step back and see the system completely. ”

“There is the opportunity to examine how different elements of the system work together.”