Last reviewed 12 October 2021
The great majority of firms with defined contribution schemes (92%) did not reduce their pension contributions during the pandemic despite the difficulties of Covid-19, according to the latest CBI/Mercer Pensions Survey.
Most employers (86%) continue to see a strong business case for providing competitive workplace pensions, the CBI said, with the same proportion believing that they have a moral obligation to help staff to save for retirement.
Completed by 221 firms, this year’s survey found that 76% of senior executives who responded believe that contribution rates higher than the current 8% statutory minimum will be required in future to ensure that employees have sufficient retirement income.
There are much higher levels of business support for raising minimum automatic enrolment contribution levels over a five-year period (78%) rather than over the next two years (47%).
CBI Director of Skills and Inclusion, Matthew Percival, said: “Employers are eager to build on the stand-out success of auto-enrolment and know that higher business contributions will be needed in future. But with firms only beginning to recover from the pandemic, and while they’re prioritising investing in more immediate pay and conditions to address labour shortages and rising living costs, any increase must take place over the next five years rather than in the short-term.”
The survey also found that pension schemes support climate-related reporting, but need to be better able to measure and compare the impact of their investments.
Since 1 October, pension schemes with an asset value of £5 billion or more must report the risks and opportunities that climate change poses to their investments. This reporting must follow the Taskforce on Climate-related Financial Disclosure (TCFD) framework.