Employee pension contributions have fallen by £1 billion over the past year, according to figures from HR Revenues & Customs (HMRC).
According to the Pensions Trends analysis issued by the Office for National Statistics, contributions have fallen from £6.3 billion in 2007/08 to £5.3 billion in 2008/09, the second time there has been a drop since HMRC’s records began in 1990.
The last drop was during the dotcom crash around 2001, which saw contributions fall by £40 million.
Membership of employer-sponsored pension schemes has also dropped. The analysis shows 50% of UK employees were members of an employer-sponsored pension scheme in 2009, which is a drop from 55% in 1997.
The report also found the proportion of employees with occupational pensions dropped between 1997 and 2009, from 46% to 3% for defined benefit schemes, and from 9% to 6% for defined contribution schemes.†
This was partially offset by an increase in the proportion of employees with employer-sponsored personal pensions, including stakeholder pension schemes.
Read more on pensions