Fewer than one in three workers under the age of 35 were aware a mandatory workplace pension was going live within months, according to new data from the Central Statistics Office (CSO) gathered in the third quarter of last year.
Auto-enrolment in My Future Fund went live in January, signing up all workers between the ages of 23 and 60 who earn more than €20,000 and not otherwise signed up to a pension with their employer.
The scheme takes 1.5 per cent of a worker’s gross wage to save for their retirement. A similar sum comes from the employer with the State adding €1 for every €3 put in by the worker. Those figures will rise gradually over the coming years so that workers will have 6 per cent of their wages taken from 2036.
About 750,000 workers were expected to find themselves drafted into the fund from the start of the year. However, only one in four workers under 25 without a workplace pension was even aware of the plan just months before it went live.
That figure rose to one in three for workers between 25 and 35, and still less than half for workers between 35 and 45 – a time when most workers without a pension would be expected to start getting nervous at the fact.
Across all ages, almost six in 10 workers with no private pension coverage were not aware of auto-enrolment less than six months before it started taking money from their wages – never mind why it was doing so. That clearly suggests the significant sums the Government invested in information campaigns about the new scheme were poorly spent.
More encouragingly, over three-quarters of those likely to find themselves enrolled in My Future Fund said they would likely stay in the scheme.
Most of those who had no occupational pension cover said either they could not afford it (39 per cent) or they simply had not got around to it (34 per cent), with younger workers more likely to have long-fingered retirement savings.
Just over half of this group said they expected to survive on the State pension with a further quarter “undecided” on how they would fund their retirement.
Overall, the CSO figures say just two-thirds of workers have some workplace pension cover, although barely a third of people who are self-employed are currently paying into a scheme.
A major weakness of the data, of course, is that it still fails to distinguish between public-sector workers – who almost universally have pension cover – and those in the private sector where coverage will be well below that headline “two-thirds” figure.