Editorial: Happy birthday China. The people’s republic is 66 this week. It is celebrating with a suitably extravagant garland of floral sculptures including trains, rockets, castles, satellites and even skiers – a nod to the country being awarded the 2022 Winter Olympics.
Apparently around 15 million flower pots have been used to create the displays – which seems a bit much for a fairly insignificant milestone. For the more rounded 65th anniversary, 22 million pots were used so you could argue they’re toning it down a bit this year.
In addition, China is closing its stock market for a week as part of the celebrations. A welcome break for some, I’m sure, but others might be feeling that perhaps now is not the best time.
What is clear is that China likes to go big when it comes to making statements, whether it’s part of a global PR rhetoric or a domestic mood-management exercise.
But away from all that grandeur and gaudiness, the UK’s pensions industry is hovering around a milestone of its own. Auto-enrolment is three years old this month, but while it is generally agreed that all has gone to plan at this stage, the bunting will remain in the box for a while yet.
Illustration by Ben Jennings
The industry is well aware that the job is far from finished and pressure is mounting to address the slim contribution levels currently going in. The initial 2 per cent floor, the total required from employers and their workers, will be phased up to eventually reach a total of 8 per cent in 2018. Still barely halfway to the 15 per cent watermark most experts say is needed to maintain a similar lifestyle in retirement.
Recent research from Royal London says six in 10 defined contribution members are auto-enrollees and that, unsurprisingly perhaps, the average age for beginning the pension saving journey is falling, now at 24 from 31.
Around 470,000 smaller employers are estimated to be enrolling next year so the task is about to get much tougher.
If an adequate retirement income is a flower in bloom, auto-enrolment is a seed that is barely out of the packet.
Maxine Kelly is editor at Pensions Expert. You can follow her on Twitter @MaxineEK and the team @pensions_expert
