Eighty-two per cent of the 350,000 employer-sponsored stakeholder pensions are empty boxes and overall long-term saving is down by 17 per cent, says the ABI.
Its figures show that just 4,550 or 13 per cent of workplace-based schemes have employer contributions. Since launch in April 2001, 1.5 million stakeholder pensions have been sold.
Sales of new regular-premium pensions in the second quarter of 2003 were down by 19 per cent to £530m from £654m in the same period last year.
Regular long-term saving of £485m in the second quarter was 17 per cent lower than the £579m recorded in the same period of 2002.
The ABI says the poor performance of stakeholder pensions means the Government must do more to stimulate the retirement savings market.
It is proposing a five-point plan for the Employer Taskforce set up by the Department for Work and Pensions and headed by Sir Peter Davis.
It is calling for a Government-led programme to encourage employers to promote the schemes they sponsor. It also wants workplace advice tax credits, practical help for employers through an information pack and a requirement on all employers to give each employee a leaflet about their scheme.
ABI director-general Mary Francis says: “Stakeholder pensions have so far fallen short of expectations. We know that active employer involvement in pensions works so we are recommending a programme of employer action to boost pension take-up.”
Newman Houghton & Co consultant David Brunning says: “Employee awareness will have no impact on take-up. The only thing that will work is to make employers contribute.”