DWP confirms 15m people aren’t saving enough for their state pension | Personal Finance | Finance
The Department for Work and Pensions (DWP) has warned that 15 million Brits are not saving enough towards their State Pension. The Pension Commission shared an interim report today (May 19) and found that members of the public are undersaving month on month.
Action will now be taken to understand the stall in savings for retirement by the department. The DWP has called for further action to navigate the decrease in state pension savings. The report states that 18 million are not paying into a pension pot at all and that lower income individuals are more likely to not make any payments.
The report reads: “Low and middle earners are most at risk, with around half saving only at minimum Automatic Enrolment levels with little else to fall back on. 45% of working-age adults – around 18 million people – are not saving into a pension at all, despite nearly half of them being in work.”
A final report from the department is expected at the end of 2027. Pensions comissioner Baroness Jeannie Drake said: “Over the past two decades since the Turner Commission there is no doubt pensions reform can be described as a success. Yet the second Pensions Commission is looking forward and seeing many people not saving enough and millions not saving at all.
“This demands a renewed national settlement on pensions. Achieving this will require clarity of purpose, but it also offers a moment of opportunity; to renew a social contract that commands confidence across the country.
“The recommendations we present in our final report will address the need to secure adequate income in later life and a pension system that is fit for decades to come.”
The report outlined that those not saving enough for retirement were predominantly among low and middle earners, the self‑employed and women, and points to the need for the system to evolve to meet modern working lives.
It adds: “There are currently 15 million people under saving for retirement which could reach 19 million without action, leaving large groups across the UK facing a severe cliff-edge when they retire, according to a new report from the Pensions Commission.”
Minister for Pensions, Torsten Bell MP, added: “Britain has got back into the pension saving habit, but the job is only half done with tomorrow’s pensioners still on track to be poorer than today’s.
“The Pensions Commission sets out clearly the scale of the challenge: not enough people are saving for retirement, and many of those that are aren’t saving enough.
“The Commission warns that without action millions more people could be at risk of becoming reliant on state support in retirement.”
