On the go: The Work and Pensions Committee has opened the final stage of its pension freedoms inquiry with a call for evidence on the challenges of saving for later life.
The inquiry will look into whether households in the UK have enough pension savings for retirement and what guidance people may need.
It will also ask what the government should be doing to support self-employed people to save for retirement and what could be done to close the gender pensions gap.
The latest stage of the inquiry comes after the committee completed two prior stages of post-pension freedoms inquiry.
In March, the committee published a report following its probe into pension scams protection, and concluded taking evidence into how savers make decisions on accessing their pensions in November.
Jon Greer, head of retirement policy at Quilter, said: “We know that many in the UK are at risk of having inadequate savings to fund their desired lifestyle in retirement.
“This is particularly true of under-pensioned groups, who are less likely to have private pension savings to supplement their state pension and indeed may not have any private pension saving at all.”
Greer quoted recent research from the Pensions Policy Institute, which showed that only 36 per cent of self-employed workers have any pension provision. Likewise, only 42 per cent of people from black, Asian and minority ethnic backgrounds and 50 per cent of disabled individuals have any private pension savings.
“These groups are also those highly impacted by the pandemic. While the furlough scheme would have absorbed some of this financial impact, some people will still have made the decision to cease or reduce their pension contributions, or many will have changed jobs or become unemployed, which will disrupt contributions,” he said.
“It is the self-employed, in particular, that need close attention. With the rise of the gig economy and self-employment, more and more see it as a way of improving their quality of life. But this comes at a cost to pension security through lack of access to auto-enrolment schemes.”
On a similar note, Phil Brown, director of policy at B&CE, provider of The People’s Pension, hopes the committee will focus on how auto-enrolment “can be further reformed, in order to build on its huge success”.
He said: “Although more than 10m more people have started saving since 2012, millions still miss out on auto-enrolment because they are either too young, don’t earn enough or are self-employed.
“It is hoped that the inquiry would also focus on how to enable more women, people from ethnic minorities and other under-pensioned groups to save for retirement.”
The call for evidence is open until February 2 2022.
