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The SELF-EMPLOYED SHUNNING PENSIONS; data graphic of the day.

Byline: ALICE CACHIA

THE proportion of selfemployed people enrolled on pensions schemes has more than halved in nearly a decade, with experts warning: "It will only get worse in the future."

Figures from the Department for Work and Pensions (DWP) reveal that just 14 per cent of people who are selfemployed are part of a pension scheme.

That's less than half the 30 per cent of selfemployed people who were part of pension schemes in 2007/08.

Experts say pension system cater well the self-By comparison, some 75 per cent of workplace employees eligible for pension schemes in 2016/17 were enrolled.

All workers - whether self-employed or employed by someone else - are eligible for the state pension when they retire.

That is currently worth PS125.96 a week, or just over PS6,500 a year.

In order to top that up, the government has introduced an auto-enrolment scheme meaning all employees must be entered into a separate workplace the current system does not enough for employed pension unless they opt-out.

Self-employed people, however, have to enrol in a private pension if they want extra income when they retire.

The figures show fewer and fewer are choosing to do so.

The Association of Independent Professionals and the Self-Employed (IPSE) represents the interests of the self-employed.

Tom Purvis, political and economic advisor for IPSE, said: "The pensions system does not adequately function for the self-employed which may have caused the decline in the number who are accessing pension schemes.

"The government and pension industry can do more to engage with self-employed people to get them saving for later life.

"There is currently far too much reliance and pressure on the state pension. Unless something is done to improve the pension uptake of selfemployed people now, it will only get worse in the future."

" Employees enrolled in a workplace pension see a minimum three per cent deducted from their wages each month. Employers must contribute at least two per cent, too. As of April this year, more than 9.6 million workers have beenThree-quarters eligible part of a pension automatically enrolled onto the pension schemes.

A DWP spokesperson said: "It is vital that everyone is able to save for retirement and the self-employed are no exception.

"Our review of automatic enrolment which consulted with the industry and relevant groups highlighted that there is no single or simple solution to meet the needs of this diverse group, though not all selfemployed are at risk of undersaving.

"We will be trialling approaches later this year to understand what works, and the industry continues to offer a range of savings products for the selfemployed."

of the workforce are workplace

CAPTION(S):

Experts say the current pension system does not cater well enough for the self-employed

Three-quarters of the eligible workforce are part of a workplace pension

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Publication:Evening Chronicle (Newcastle, England)
Date:Jul 3, 2018
Words:470
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