Department for Work and Pensions
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Government backs bill to expand pension saving to young and low earners

The Department for Work and Pensions (DWP) confirmed it will support proposals to expand Automatic Enrolment, enabling millions of people to save more and to start saving earlier.

Jonathan Gullis MP’s Private Members Bill, backed by the government, grants two extensions to Automatic Enrolment – abolishing the Lower Earnings Limit for contributions and reducing the age for being automatically enrolled to 18 years old.

Minister for Pensions, Laura Trott, said:

We know that these widely supported measures will make a meaningful difference to people’s pension saving over the years ahead.

Doing this will see the government deliver on our commitment to help grow the economy and support the hard-working people of this country, particularly groups such as women, young people and lower earners who have historically found it harder to save for retirement.

Jonathan Gullis MP, said:

Auto-enrolment of pensions will benefit scores of young people in all four corners of the country, which is why I am delighted that Minister for Pensions Laura Trott is supportive of the bill.

With all the evidence of the huge positive impact it can have, it is a no-brainer that we now need to extend auto-enrolment to those aged 18 and above. I am confident this Bill will make a huge difference to people from Kidsgrove to Consett.

Lowering the age at which eligible workers must be automatically enrolled into a pension scheme by their employers from 22 to 18 will make saving the norm for young adults and enable them to begin to save from the start of their working lives.

In addition, the bill provides for the removal of the Lower Earnings Limit, supporting those with low earnings and multiple jobs by ensuring they are saving from the first pound earned.

Following the success of the Automatic Enrolment, the government intends to continue its work with thousands of employers and pension providers to further boost the amount of people in a workplace pension and the amount they save for retirement.

It will also continue its work on empowering savers to know their pension options by introducing revolutionary products such as Pensions Dashboards and Mid-life MOTs, providing accessibility and innovation in how people save for their retirement.

Additional information

  • The intention is that the provisions in this Bill will not result in any immediate change but will give the Secretary of State powers to amend the age limit and lower qualifying earnings limit for Automatic Enrolment.
  • There will be a statutory requirement to consult and report on the outcomes to inform the implementation approach and timing, before using these powers. This will help ensure the strong consensus that underpins the success of automatic enrolment is maintained.
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