Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Auto-enrolmentLatest NewsPay & benefitsPensions

Boomtime for defined contribution pensions as final salary schemes are abandoned

by Michael Millar 10 Aug 2006
by Michael Millar 10 Aug 2006

The proportion of employers offering defined contribution pensions schemes has risen considerably as defined benefit (final salary) schemes continue to close, according to new research.


The annual survey by HR consultants Hewitt Associates found two-thirds of open employer-sponsored pension schemes are now defined contribution, compared with 55% in 2005,


The results also show the average size of schemes has increased, with more than a third of schemes controlling assets of more than £10m. In 2004, just under a fifth of schemes were this size.


It seems the new government focus is succeeding in raising awareness of pensions issues with employee take-up rates increasing to six out of 10 employees, compared with less than half in 2005.


The survey results also showed that employer contribution levels can act as a threshold for employee interest, with schemes that offer less than 5% employer contribution recording a 42% take-up, while companies contributing 10% or more have a 79% take-up.


Total contribution rates have remained unchanged since 2005 at 11% (4% employee, 7% employer). However, employers with established defined contribution schemes have increased their contributions by 50% since 2005.


Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

Hewitt’s survey also indicated that employers that provide a defined contribution scheme to which employees are automatically enrolled typically pay higher contributions. The average employer contribution for auto-enrolment schemes is 8% compared with 6% for opt-in schemes.


Tony Baily, defined contribution pensions specialist at Hewitt Associates, said: “Now is clearly a good time for employees to enrol in their company pension scheme and maximise the benefit on offer from their employer.

Michael Millar

previous post
Northern Ireland benefits as Indian company plans to create call centre jobs in Belfast
next post
Women urged to save more for retirement or risk relying on state handouts

You may also like

Doctors vote for return to strike action

8 Jul 2025

‘Frustrating’ that NHS Plan has overlooked OH, warns...

8 Jul 2025

Employment Rights Bill set to ban employer NDAs

8 Jul 2025

Young people unprepared for world of work, says...

8 Jul 2025

Empower and engage for the future: A revolution...

7 Jul 2025

Bereavement leave to extend to miscarriages before 24...

7 Jul 2025

One in seven ‘revenge quit’ in latest employee...

7 Jul 2025

Skills shortfall in construction threatens housing target

4 Jul 2025

Company director wins £15k after being told to...

4 Jul 2025

MPs demand Home Office tightens visas to protect...

4 Jul 2025

  • Empowering working parents and productivity during the summer holidays SPONSORED | Businesses play a...Read more
  • AI is here. Your workforce should be ready. SPONSORED | From content creation...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+