In his pre-Budget report yesterday, Chancellor Alistair Darling announced that employers can contribute only 1 per cent to their employees’ pensions for an extra year, resulting in members not recieving the full 3 per cent contribution until October 2017.
The move will boost Treasury coffers by £2.4bn.
But chief executive Richard Saunders says: “The further delay to the Pension Commission’s proposals for auto-enrolment is disappointing.
“By October 2017, when the new system will be fully implemented, it will have been almost 12 years since those proposals were originally published.
“We appreciate the scale of the logistical challenge ahead, and clearly, a ‘big bang’ approach in 2012 has risks.
“But both the phasing timetable and the regulatory proposals to implement auto-enrolment are risking further complexity.
“We hope the relatively simple message about the need to save more for retirement does not get diluted or obscured by the mechanics of the process intended to facilitate this.”
Friends Provident has also attacked the delay.
Head of corporate pensions marketing Martin Palmer says: “This is another shining example from the Chancellor of how to lose friends and alienate people.
“The DWP had already delayed the time it would take for employers’ contribution rates to reach 3 per cent to October 2016 and now we learn this will in fact be 2017.
“Not only will this fail the millions of people who are currently not saving adequately for their retirement but it could potentially mean the many who are currently in good quality schemes will suffer from levelling down. Surely this cannot be the Government’s intention?
“It has to act immediately to help employers to implement auto-enrolment on a voluntary basis.”