Lower expected earnings growth – projected by the Office for Budget Responsibility to be 1.5 per cent in the medium term compared to the 2 per cent expectation of the Commission – has the effect of boosting the expected replacement rate by a further 1 percentage point. [...] One of the most significant social policy interventions of the past generation, auto-enrolment has radically increased the share of workers who are saving in a pension from 47 per cent in 2012 to 80 per cent in 2023.2 However, the default pension contribution rates reached the intended 8 per cent of gross income only in 2019, so it is fair to say that the scheme is still in its early stages and ha. [...] As a result, the combination of the State Pension and auto-enrolment savings is now projected to leave a median earner who saves from the age of 30 to 67 with a total gross earnings replacement rate of around 51 per cent, above the Commission’s minimum goal of 45 per cent, but a long way short of the updated target replacement rate of 72 per cent. [...] The new State Pension is likely to provide around 34 per cent of median ‘final earnings’ In the early 2000s, the combination of the basic State Pension (bSP) and the earnings- related state schemes such as the State Earnings-Related Pension Scheme (SERPS) and the State Second Pension (S2P) meant that a median earner with a full contribution record could expect to receive around 35 per cent of thei. [...] The Department for Work and Pensions (DWP) estimates that from later in this decade some 80 to 90 per cent of retirees can expect to receive the full rate of the new State Pension.27 As a result, means-tested entitlements are set to become a very marginal part of the system, achieving the Pensions Commission’s vision of providing people with a stable base of state provision on which to plan their.
Related Organizations
- Pages
- 80
- Published in
- United Kingdom
Table of Contents
- _Hlk176703974 3
- _GoBack 3
- _Hlk178838157 3
- _Hlk175153692 6
- _Hlk177136465 12
- _Hlk178839758 14
- _Hlk175233387 17
- _Ref178002068 21
- _Ref173923993 23
- _Ref177029244 24
- _Ref173768230 25
- _Hlk178692149 25
- _Ref173493282 27
- _Ref173859276 27
- _Ref173859314 29
- _Ref177031032 29
- _Hlk175208497 30
- _Ref174957803 31
- _Hlk175208662 31
- _Ref174960848 32
- _Hlk175208719 33
- _Hlk175208740 33
- _Ref174961896 33
- _Hlk178847499 33
- _Hlk175208761 34
- _Ref178672234 35
- _Hlk175213043 35
- _Hlk175214423 36
- _Hlk175214462 36
- _Hlk175214513 36
- _Hlk175214496 36
- _Hlk175214838 37
- _Hlk175215166 37
- _Hlk177134417 38
- _Hlk175215851 38
- _Hlk175216019 38
- _Hlk175216462 38
- _Hlk175216956 39
- _Hlk175217693 40
- _Hlk178850931 41
- _Hlk175217722 41
- _Hlk175217730 41
- _Hlk175217751 41
- _Hlk175217758 42
- _Hlk175217802 42
- _Hlk175217991 43
- _Ref174704454 44
- _Ref177996157 45
- _Hlk175218175 46
- _Hlk175218226 47
- _Ref174976987 47
- _Hlk176537762 48
- _Hlk176537835 48
- _Hlk176538159 48
- _Ref177124088 49
- _Ref177124852 50
- _Hlk178850983 51
- _Hlk175221154 53
- _Hlk175221059 54
- _Hlk175221071 54
- _Hlk173913729 54
- _Hlk175221087 54
- _Hlk175221313 54
- _Ref174093220 55
- _Ref174459061 56
- _Hlk175221353 56
- _Hlk175221387 56
- _Ref174025061 57
- _Hlk175221433 57
- _Ref174452793 58
- _Hlk175221862 58
- _Hlk175221907 58
- _Ref174101248 59
- _Ref174101244 59
- _Hlk175221946 59
- _Hlk175221973 59
- _Hlk178771663 59
- _Hlk175222007 60
- _Hlk175222078 60
- _Hlk175227922 63
- _Hlk175227959 63
- _Ref174365248 63
- _Hlk175228026 63
- _Hlk175228065 64
- _Ref174353765 65
- _Hlk175228076 65
- _Ref174363146 67
- _Hlk175228085 67
- _Hlk178840213 69
- _Hlk178840145 69
- _Hlk178851132 70
- _Ref175131164 71
- _Ref175133085 75
- _Hlk175230591 75
- _Ref175134548 77
- _Hlk175230600 77
- _Hlk175230925 78
