Millions expected to be saving more, or for first time, in workplace pensions
More than 10 million people are expected to be newly saving, or saving more, by 2020, due to a landmark scheme to place employees in to workplace pensions, new Government figures show.
Last year it had been estimated that the annual saving in a workplace pension was to increase by £15 billion as a result of automatic enrolment - based at that time on nine million workers newly saving or saving more.
But now, the Department for Work and Pensions (DWP) said the new estimate means that an additional £17 billion a year is projected to be saved in to workplace pensions by 2019-20.
Only about 3.6 million or just over a third (36%) of the 10.1 million workplace pension savers projected to be newly saving or saving more in the new projections are female workers.
This reflects underlying labour market factors such as earnings and working patterns, the document said.
The new figures are based on revised modelling by the DWP, which said additional hiring by, and growth of, employers since 2012 has been taken into account, resulting in higher estimates of the numbers of eligible workers.
This analysis assumes an opt-out rate of 10%, based on opt-out rates to date, which has also resulted in a higher estimate of the number of workers expected to be newly saving and saving more.
The opt-out rate is assumed to be 10% for both male and female workers and across all age groups.
Automatic enrolment started in 2012 amid fears that people were living for longer but not putting aside enough for their old age. It is being rolled out gradually, with the biggest employers with more experience of pensions having started first, and the smallest employers now coming on board the scheme.
Workers are generally eligible to be placed into a pension by their employer if they are at least 22 years old and under state pension age, earning more than £10,000 a year and work, or usually work, in the UK.
Pensions Minister Richard Harrington said: "It is clear we are helping to create a culture of saving, giving people a much-needed boost to their pensions, and the important work on roll-out continues.
"My mission is to ensure everyone has the opportunity to benefit from a workplace pension. For some people, this may be the first time they have saved in this way, and we must help them build a big enough savings pot so they can enjoy a comfortable retirement."