Just 8 per cent of workers who have been automatically enrolled into a workplace pension scheme have opted out, according to research from Scottish Widows.
In its annual workplace pensions report, published last week, Scottish Widows analysed the post-auto-enrolment workplace pensions market.
It found that fewer than one in 10 employees have opted out so far, one year on from when employees began to be auto-enrolled into their company pension scheme. This compares with earlier industry predictions of up to 30 per cent of employees opting out.
Scottish Widows corporate pensions head of business development Lynn Graves says: “It is encouraging to see the positive impact auto-enrolment has had on employee attitudes to saving for retirement.
“It is particularly promising that opt-out rates for the scheme are so much lower than originally forecast.
“However, the biggest challenge is yet to come as smaller companies start to auto-enrol and we must continue as an industry to work tirelessly to first engage and then educate to ensure opt-out rates remain low.”
Syndaxi Chartered Financial Planners managing director Robert Reid says: “Auto-enrolment has got off to a good start but the real test will be when the small employers come in.”
The report also reveals employee awareness of auto-enrolment has increased from 39 per cent in 2012 to 65 per cent in 2013.
The Department for Work and Pensions has attempted to raise awareness of the reforms among employers and employees through a multi-million pound TV advertising campaign.
Awareness of auto-enrolment remains low among lower earners, however, with 21 per cent of people earning less than £30,000 unaware of the changes.
Widows’ research also found that around a third of employers are still unsure about the scheme they will use. Costs associated with implementing the changes were cited as a concern by 23 per cent of firms surveyed.