One-fifth of UK workers cannot afford pension deductions

One in five (18%) UK workers say they do not have a pension because they cannot afford to make savings, according to a survey from Aon Consulting.

The research is part of the Aon Consulting European Employee Benefits Benchmark, a survey of more than 7,500 workers from 10 of the leading economies in Europe: Belgium, Denmark, France, Germany, Ireland, The Netherlands, Norway, Spain, Switzerland and the UK.

The research also reveals that governments and employers across Europe are failing to educate workers sufficiently about the long-term value of their pensions.

In the UK, only 12% of respondents are interested in their pension. The French and Dutch share the same apathy towards pensions, while interest is far greater in Germany (37%), Belgium (34%) and Switzerland (33%).

The research also found:

• 70% of people working in education say they are provided a pension by their employer compared to only 33% of people working in the retail or property sectors.

• 13% of males think that pensions are a con compared to 8% of females.

• 8% of 18-24 year olds are interested in their pensions, compared to 26% of imminent retirees (55-65 year olds).

• 5% claim they have actively made the decision to rely solely on state benefits.

Oliver Rowlands, head of retirement, EMEA, at Aon Consulting, said: “A lot of people will simply be walking blindly into retirement poverty unless they take more of an active interest in their pensions. Governments and some employers are looking at ways to reduce their pension’s obligations, so it is imperative that people take more responsibility themselves for their retirement finances.

“Many employers continue to take the provision of appropriate pensions for their employees very seriously, and are spending a lot of money to provide for the long-term welfare of their workforce. Although workers do generally value employer-sponsored pensions, both defined benefit and defined contribution, they tend not to manage their affairs until close to retirement when it is already too late.

“Employers need to effectively communicate the value and choices relating to this benefit through open, honest, clear and continuous communication to their employees in order to make it an effective weapon in their arsenal in the war for talent. At the same time they need to ensure they are educating and helping their workforce take the necessary steps to take appropriate and necessary action around retirement savings.”