NAPF: Workplace pensions valued but more to be done on confidence

A new National Association of Pension Funds (NAPF) Workplace Pensions Survey has revealed that a workplace pension is the most important company benefit an employer can offer.

However, while three quarters (75%) of employees believe it is important to have a pension that comes with their job, less than half (48%) have confidence in pensions when compared with other forms of retirement saving. With 45% of those surveyed not having confidence in pensions, there is a net Pensions Confidence Gap of only +3%.

The survey also revealed that those employers not offering a workplace pension are missing out on a loyalty bonus from their staff. Almost half (49%) of employees in these companies would feel greater loyalty to that company if they did offer a workplace pension.

NAPF Chief Executive, Joanne Segars, said: “Today’s workers still value pensions as a fundamental part of their employment package and believe they remain the best way to save for retirement. For employers there is a clear message that providing a workplace pension is rewarded by increased employee loyalty.

“The gap between the importance people attach to a workplace pension is at odds with their confidence, so it is clearly imperative that both the Government and the industry work harder to restore a positive image.

“Increased confidence will, in part, come with increased understanding and direct access to information. The workplace is an ideal place to provide this information.”

Pension is the most important workplace benefit for men

When rated against other company benefits, men value pensions more than women, with the latter believing that flexible working arrangements are more important. This shows that for some women, the ‘now factor’ of meeting family commitments is a higher priority than their own retirement income.

Table 1 : What do you consider is the most important benefit, on top of your basic salary, an employer can offer? (gender breakdown)

	All	Male	Female
Company Pension	30%	35%	25%
Flexible Working	23%	17%	29%
Bonus	21%	24%	17%
Generous Holiday Allowance	11%	9%	14%
Health Insurance	7%	8%	6%
Life Insurance	2%	2%	2%
Gym Membership	1%	1%	1%

Table 2 shows that, unsurprisingly, a workplace pension becomes a higher priority as people become older.

Table 2 : What do you consider is the most important benefit, on top of your basic salary, an employer can offer? (age breakdown)

	16-24	25-34	35-44	45-54	55-64
Company Pension	16%	21%	34%	39%	45%

The Pensions Loyalty Bonus

The research showed that half (49%) of employees who work for a company that does not offer a workplace pension said they would feel more loyalty to their employer if there was such a pension on offer.

This loyalty bonus should be a consideration for companies that suffer from high staff turnover.

Table 3 : If your employer did offer a pension, would you have additional loyalty towards them? (All employees with no workplace pension available)

	All	Male	Female
Yes	49%	52%	45%
No	33%	30%	36%
Don't Know	18%	18%	18%

For those employees who work for a company that does offer a workplace pension, 39% said they are more loyal while 57% said it made no difference.

Workplace pensions valued

Three quarters of employees (75%) believe it is important to have a pension that comes with their job (men - 78% and women - 71%).

The overall value of a workplace pension can be seen because 55% of those employees without workplace access believe they are still important.

Table 4 : How important is it to have a pension that comes with a job?

	All Employees	Men	Women	Employees with Access	Employees without Access
Important	75%	78%	71%	83%	55%
Not Important	22%	19%	25%	16%	40%

Pensions Confidence Gap – an area of concern for whole industry

There is a mismatch between those employees viewing workplace pensions as important (75% see table 4) while at the same time not feeling the same levels of confidence (48%) about them when compared with other forms of retirement saving.

The figures below show that the pensions confidence gap is just 3% overall. However, the granularity shows that for both women and those employees without access to a workplace pension, the Confidence Gap is negative.

Table 5 : When it comes to saving for retirement, how much confidence do you have in pensions compared to other forms of saving?

	All Employees	Men	Women	Employees with Access	Employees without Access
Confident	48%	55%	41%	57%	30%
Not Confident	45%	41%	48%	38%	62%
Confidence Gap	+3%	+14%	-7%	+19%	-32%

Pensions are seen as the best way to save for a pension

Compared with other forms, 40% of employees view pensions as the best method of saving for retirement. However, for those employees without a current workplace pension, property (33%) is seen as a better option than a workplace pension (25%).

Table 6 : Which of the following do you consider to be the best way to save for retirement?

	All Employees	Employees with Access	Employees without Access
Pensions	40%	48%	25%
Property	25%	22%	33%
ISAs	14%	14%	13%
Bank Account	6%	4%	8%
Other	2%	2%	1%
Don't Know	13%	10%	20%

ENDS

Notes for Editors

The survey, which questions people about their attitudes towards workplace pensions, was carried out by TNS among 1,154 GB full and part-time employees (self-employment excluded from research) aged 16 - 64 between 14th to 21st February 2008”


About The National Association of Pension Funds

The NAPF is the leading voice of workplace pension provision in the UK. Some 10 million working people are currently in NAPF Member schemes, while around 5 million pensioners are receiving valuable retirement income from such schemes. NAPF Member schemes hold assets of around £800bn, and account for approximately one fifth of investment in the UK stock market.


Journalists requiring further information, please contact Mark Brooks via

020 7808 1312 mark.brooks@napf.co.uk 07917 506683


Mark Brooks
Head of Press
Tel: 020 7808 1312 07917 506 683
Fax: 020 7222 7585
http://www.napf.co.uk

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