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The obsession with auto-enrolment opt-out rates

Benefex CEO and Founder, Matt Waller, looks behind the headlines.

Not a day goes by where there isn’t another large employer announcing their auto-enrolment opt-out rates.  All good, headline-grabbing stuff - but does it tell the full story? 

Opt out rates versus membership rates 

Having looked at a number of them in more detail I am not sure that it does.  We seem to have gotten ourselves into a obsessed position of focusing on just opt-out rates of Eligible Job Holders, rather than on pension membership as a whole.

When we see Co-op and ASDA reporting low opt-out rates, the articles seem to neglect the fact that they are bound to have very significant populations of non-eligible and entitled workers.  In terms of plugging the long-term savings gap this only goes part way. 

Don’t get me wrong, celebrating the success of auto-enrolment is a good thing, but we still need to focus on the full picture to solve the issue. 

Increasing contributions 

We all know that the minimums are not enough to provide for most people in retirement.  What will be interesting is to see if the auto-enrolment opt-out rates remain consistent as we reach the threshold increase dates.  Will employees be as happy to pay 5% from their salary automatically?  We will have to wait and see. 

For more information on auto-enrolment and how it affects your organisation and employees email autoenrolment@benefex.co.uk or call 0844 963 0023.

 

 

Clients & Testimonials

Paramount Pictures
Paramount Pictures - Rebecca Hart, Compensation & Benefits Analyst, International HR I have been very impressed with Benefex and their professional and flexible approach. The project team we work with are very efficient, knowledgeable and approachable. This approach extends to their customer service team, for whom we have also received great feedback on from our employees. It has been a pleasure working with them on our project.
  • Paramount Pictures - Rebecca Hart, Compensation & Benefits Analyst, International HR I have been very impressed with Benefex and their professional and flexible approach. The project team we work with are very efficient, knowledgeable and approachable. This approach extends to their customer service team, for whom we have also received great feedback on from our employees. It has been a pleasure working with them on our project.
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    E.ON - Ant Donaldson, Senior Specialist - Employee Benefits Our enrolment achieved increased take up of every benefit offered. This can be largely attributed to the work on the scheme design and communication strategy.
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    Philips Electronics UK Ltd - Ami Foot, HR Manager - People Services Total Reward Statements have done a fantastic job of highlighting all the benefits we offer to our employees. People link everything together now - which we certainly never had before. The branding of the statements is a perfect fit for Philips and the brand will continue to be used across all future benefit communications.
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    The AA - Hazel Lee, Head of HR We now have a scheme which we feel proud to own; proud to own in HR and proud to own as a business. The partnership with Benefex has exceeded all expectations we had for the scheme.
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    Interserve - ​Talent shortages from the 2012 Olympics, plus UK housing shortages, led Interserve to revamp their benefits offering to attract and retain talented employees.