What is the Current Legislation?
Under current rules, employees aged between 22 and state pension age (currently 66), may be automatically enrolled into their employer’s workplace pension scheme.
What's Changing?
A new piece of legislation called the “Pensions (Extension of Automatic Enrolment) Act 2023” was given the seal of approval to become law, on the 19th of September 2023, by getting Royal Assent.
Under this act the government now has the power to –
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Reduce the minimum age to be automatically enrolled into a workplace pension to 18 years old.
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Lower the minimum earnings threshold at which employers have to contribute towards workplace pensions from £6420 a year to £1 a year. (This doesn’t however change the existing £10,000 minimum earnings threshold to be automatically opted into a workplace pension).
When It's Coming into Effect?
There is no current date for when this new legislation may become law. The Government needs to consult on how and when these powers could be used.
The Impact?
More money in the pension pot for younger earners for when they retire.
What Do You Need to Do?
Nothing for employees to do right now. My People will provide updates when these changes take effect.
