Private sector firms drop pension schemes

The number of private sector employers offering pension provisions has fallen by 8% in the past three years, according to research by the Department for Work and Pensions (DWP).

About half of private sector companies (52%) offered pensions to their employees in 2003, the Employers’ Pension Provision Survey 2005 found, but this fell to 44% last year.

Just 6% of the 2,401 companies surveyed by the DWP and research consultancy BMRB contributed to an occupational pension scheme and only 2% had a scheme which was open to new employees.

Less than one third (29%) of employers also provided access to stakeholder pension schemes, compared with 35% in 2003.

The report is intended to provide an up-to-date picture of pension provision by private sector employers.

The average employer contribution in the past two years was found to be 10% of employees’ salaries for open defined benefit schemes with more than 10 members, 5% for open defined contribution schemes with more than 10 members, and 5% for group personal pensions.

www.dwp.gov.uk/

Pensions Watch

 

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