Third sector employees ‘neglect pensions’
One third of charities remain disappointed with the take-up rate of their employee pension schemes, says recent research from the Association of Chief Executives of Voluntary Organisations (ACEVO) and employee benefits adviser, Foster Denovo Limited.
Eight in ten organisations (82 percent) of those surveyed stated that they offered some sort of pension arrangement, either contributory or non-contributory.
Out of these groups providing pensions, group personal pensions were most commonly offered (32 percent), with individual or stakeholder pensions standing at 26 percent, and group stakeholder pensions at 23 percent. Nearly a quarter of companies offer some sort of company scheme (23 percent), but only 6 percent offer a final salary scheme.
As to why take up was low, 75 percent of respondents advised that this was because employees are not interested, or do not consider pension planning a priority. Other reasons included staff feeling they could not afford a pension (44 percent), or they thought that they were too young for one (34 percent).
A quarter of organisations say that more than 80 percent of their staff are members of their pension scheme (more the case with small organisations with a turnover of less than one million pounds). Of those who believed take-up was high, 80 percent stated this was due to good employer contributions.
Seb Elsworth, head of strategy at ACEVO, commented: “These findings highlight the need for employers to educate and communicate with all staff, particularly younger ones, on the importance of planning for retirement. The third sector represents a major part of the UK workforce, and, I believe, there is a real need to address this issue now, before it becomes too late.”
Ian Bird, senior partner at Foster Denovo, added: “When the Personal Accounts regulations come into force, employers will have to enrol employees in a Personal Account, or put them into an existing pension plan.”
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