Government must raise minimum pension contributions to ‘avoid pensions timebomb’ – London Business News | Londonlovesbusiness.com

UK investment platform and pension provider, TILLIT, is calling on the Government to raise minimum pension contributions to tackle Britain’s looming retirement crisis.

Chancellor Rachel Reeves has previously initiated discussions about increasing pension contributions inspired by the Australian system, yet no changes have been made.

While Australia requires employers to contribute 11.5 percent into workers’ pensions, the minimum contribution rate in the UK is 8 percent, and only 3 percent must come from the employer.

Currently, over 80% of households are falling short of a comfortable retirement. According to TILLIT, increasing contributions is essential to tackle this crisis.

Along with calling for change, TILLIT is helping savers protect their financial future as the first UK pension provider to offer auto-escalation by default in their pension product.

This feature allows members to gradually increase their contributions over time and is based on the hugely successful concept ‘save more tomorrow’ that has been helping US pension savers for over a decade already.

TILLIT Founder and CEO, Felicia Hjertman said, “It’s deeply frustrating to see the Government’s continued inaction on raising the minimum level for employer pension contributions, thereby washing their hands of the collective responsibility to ensure people can afford to retire.

“Current contribution rates fall far short of what’s necessary to ensure a comfortable retirement, something which the government was warned about by the Pension Commission in the Lord Turner report over a decade ago.

“At TILLIT, our number one priority is to help people take control of their financial future, and that is why we have launched auto-escalation as a core feature of the TILLIT Pension.

“The Government should take note to avoid a pensions timebomb.”