2018 Report details for project: Automatic Enrolment Programme

Project name: Automatic Enrolment Programme - there are 6 reports for this project: 2014, 2015, 2016, 2017, 2018, 2019
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Organisation: DWP (D10) - see all reports for this organisation
Report year: 2018 (data is from Sept 2017)
Category: Transformation - see all reports for this category
Description: The Automatic Enrolment Programme was established to implement the Government’s workplace pension reforms. The overarching aim of the reforms is to get more people saving more for their retirement. The Programme went live in October 2012, delivering: 1) Automatic enrolment - a new duty on employers to automatically enrol their eligible workers into a qualifying workplace pension scheme; and to increase the incentive to remain saving in a pension scheme, there is a mandatory employer contribution. 2) The National Employment Savings Trust – which has a public service obligation to accept any employer who wishes to use it to meet their employer duty. It provides a good quality pension to individuals on low to moderate earnings. 3) An employer compliance regime - run by the Pension Regulator to support these measures. The implementation approach is gradual, with employers being 'staged' by size, over the period October 2012 to February 2018, with original business case estimates forecasting an increase of savers between 6-9 million. Contributions to pension schemes are being gradually increased over time to provide a period of adjustment for employers and individuals, with full contributions being paid from April 2019. The original business case estimated that once contribution rates were fully phased in, pension savings as a result of AE would have increased by £8 billion per year.
DCA (RAG): Amber/Green
DCA text: Programme implementation has been, and continues to be, hugely successful so far with the original aim of 6-9 million employees automatically enrolled being achieved ahead of forecast. The Programme estimates in relation to the amount of increased savings have also increased significantly to £20 billion per year against an initial estimate of £8 billion per year. The Programme has in place a robust monitoring and evaluation strategy that draws information from all of the programme stakeholders and is reported routinely on a monthly basis. Our approach to monitoring is iterative and analytical colleagues continually look to enhance the options available. The outputs of this monitoring show that there continues to be high levels of compliance amongst the c.1million employers that have declared and opt-out rates amongst individuals remain consistently low at around 10%. The Programme is now focusing on supporting small and micro employers through the final months of roll-out, alongside preparing all employers, and their employees, for the forthcoming increases in pension contribution rates in April 2018 and April 2019. The Programme is also working to support employers that have been established since October 2017 and must automatically enrol new employees into a workplace pension from the outset. Whilst there remains a level of uncertainty around the ongoing behaviours of employers and employees, when balanced with the significant success of the Programme in achieving its objectives to date, the programme board rate the programme overall as Amber/Green.
Start date: 2007-05-01
End date: 2019-11-30
Schedule text: The Programme went live on time. The implementation approach has been designed to accommodate the significant increase in volumes over the 2015-2018 period, the Programme is on track to deliver this to timetable.
Baseline: £103.08m
Forecast: £70.98m
Variance: -31.00%
Variance text: The proportion of employers complying continues to be higher than forecast so the costs of ensuring compliance have been lower than budgeted.
Whole Life Cost: £1,249.00m
WLCost text: The whole life costs now cover the period from 2007-08 to November 2019 (rather than to 17/18) and includes the set-up and running costs of the compliance regime within The Pensions Regulator (TPR); the communications costs for raising awareness through a series of campaigns; and Programme costs.
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Sourcefile: IPA_2018.csv

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Acknowledgement: GMPP data has been re-used under the Open Government Licence.