The number of private sector employees contributing to a work pension scheme has hit an all-time low, official figures show.
The Office for National Statistics’ annual Occupational Pension Schemes Survey shows 2.9 million people contributed to work schemes in 2011, compared to 3 million in 2010.
It is the lowest level since the survey began in 1953 and comes on the eve of the introduction of auto-enrolment in October.
In the last 10 years, the total number of employees contributing to private sector schemes has nearly halved from 5.7 million in 2000 to 2.9 million today.
The report says: “The decline in numbers of active members in the private sector over the last 10 years reflects the fall in active membership of private sector defined benefit schemes. Active membership of such schemes fell to an estimated 1.9 million in 2011 from 4.6 million in 2000.”
In total, 8.2 million people contributed to work schemes in 2011, with 5.3 million in the public sector.
Affluent Financial Planning managing director Carl Melvin says: “It is not a surprise to see teh fall in private defined benefit schemes. Private sector companies, other than large firms, are finding it too expensive and too much risk. They have to guarantee the benefits without knowing the cost leaving them a blank cheque for the liabilities.”
Some 9.8 million people have stopped paying contributions but have preserved entitlements and 9.2 million receive pension payments.
For private sector defined benefit schemes, the average contribution rate in 2011 was 4.9 per cent for employees and 14.2 per cent for employers.
For private sector defined contribution schemes, the average contribution rate was 2.8 per cent for employees and 6.6 per cent for employers.