View more on these topics

Pension contributions tumbled during downturn

Personal pension contributions fell by 16 per cent during the recession, according to HM Revenue & Customs figures.

Employee contributions fell to £5.26bn in 2008-09, from £6.29bn the year before. This is only the second time that contributions have fallen since records began in 1990. In 2001-02, contributions dropped by £40m.

Hargreaves Lansdown says a collapse in saving of this magnitude will undoubtedly have repercussions down the line unless savers make good their missed contributions.

Pensions analyst Laith Khalaf says: “The new Government could do its bit by introducing greater flexibility in how and when you can draw on your pension. As things stand individuals are understandably reluctant to put money away for their retirement when their immediate future looks uncertain.”

But HMRC figures also revealed that employer contributions have almost doubled since pension contribution limits were increased in April 2006, from £4.07bn to £7.71bn. Employees were upping their contributions also until 2008-09, with contributions rising by a third from £4.74bn to £6.29bn.  


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm