London Daily

Focus on the big picture.
Thursday, Feb 12, 2026

More people leaving workplace pension schemes, TUC warns

More people leaving workplace pension schemes, TUC warns

Growing numbers cannot afford to save for retirement, prompting calls to increase employer contributions
Growing numbers of workers are cutting their workplace pension contributions or opting out of schemes entirely because they cannot afford payments – prompting calls for employers to increase the amounts they pay in.

With real wages falling and bills rising sharply, people across the country are looking for ways to reduce spending and supplement their incomes, and the TUC said it was hearing about staff in both the public and private sectors who had concluded they could not afford to save for retirement at the moment.

“Based on what our unions are telling us, anecdotally they are saying quite a lot of people are having to leave schemes,” a spokesperson for the trade union said. “That is public sector and private sector … It’s something we’re hearing quite a lot from the public sector unions.”

Its warnings follow data released in August indicating that the number of people choosing to opt out of their company pension scheme increased by almost a third between March and July this year.

The figures were issued by Penfold, a digital pensions platform used by private savers, the self-employed, company directors and businesses.

About 10% of people quit their workplace scheme, and the TUC said Penfold’s findings – which would translate into a two to three percentage-point increase in opt-out rates, lifting them to about 12%-13% – appeared broadly consistent with what it was hearing.

The reports have already led to calls for the government and the pensions industry to work together to come up with a solution to avoid people being left short at retirement.

Investment advisers say workers thinking of quitting their scheme need to think very carefully before jumping ship. Someone who opts out is essentially giving up the pension contributions from their employer, which effectively amounts to “a voluntary pay cut”, said Tom Selby, head of retirement policy at investment firm AJ Bell. “Furthermore, you will miss out on the upfront boost provided by pension tax relief,” he added.

Tisa (the Investing and Saving Alliance), a membership organisation for UK financial firms, said: “In times like these, reducing or opting out of pension contributions is unsurprising, and it is easy and understandable to forget about the long term.”

Renny Biggins, head of retirement at Tisa, said possible solutions it was proposing included increasing the amount that employers had to pay in under the UK’s auto-enrolment workplace pension regime from 3% of earnings to 6%, in order to allow staff to cut their contributions and release some money to supplement their disposable income.

Alternatively, employers could opt to continue paying pension contributions while allowing their workers to take a temporary contribution holiday.

“We recognise there are immediate needs for people to provide for their families, but we are nonetheless concerned that if people decide to reduce or opt out of their pension now, there will be consequences in the future,” said Biggins.

Jack Jones, pensions policy officer at the TUC, said: “Our longer-term policy target is for increased employer contributions.”

National Employment Savings Trust (Nest), a publicly owned pension scheme set up by the government which now has 11.2 million members, said the opt-out rate for newly enrolled workers had largely remained stable throughout the pandemic and was currently at 10.2%.

Nest said it had seen a very small increase in the number of members becoming inactive, which included people who had chosen to stop paying in, but that it could not say if this was due to increases in the cost of living.
Newsletter

Related Articles

0:00
0:00
Close
Document Suggests Prince Andrew Shared UK Briefing on Afghan Investment Opportunities with Jeffrey Epstein
We will protect them from the digital Wild West.’ Another country will ban social media for under-16s
McDonald's Shortens Breakfast Hours in Australia Due to Egg Shortage
Heineken announces cut of 6,000 jobs due to declining beer demand
Beijing Brands UK Hong Kong Visa Expansion ‘Despicable and Reprehensible’ After Jimmy Lai Sentencing
Tesco Chief Warns UK Is ‘Sleepwalking’ Toward a Joblessness Crisis
Trump’s ‘Act of Great Stupidity’ Comment on UK Chagos Deal Reverberates Through Diplomacy and Strategy
New U.S. filings say Jeffrey Epstein repaid Les Wexner one hundred million dollars after theft allegation
Commerce Secretary Howard Lutnick acknowledges 2012 visit to Jeffrey Epstein’s private island as lawmakers scrutinise past ties
Helsing and Stark Defence loitering-munition drones and Germany’s race to industrialise battlefield autonomy
UK orders deletion of Courtsdesk court-data archive, reigniting the fight over who controls public justice records
UK Police Review Fresh Claims Involving Prince Andrew as Senior Royals Respond to Epstein Files
Keir Starmer’s Premiership Faces Unprecedented Strain as Epstein Fallout Deepens
Starmer Vows to Stay in Office as UK Government Faces Turmoil After Epstein Fallout
China and UK Signal Tentative Reset with Commitment to Steadier, Professionally Managed Relations
UK Confirms Imminent Increase in ETA Fee to £20 as Entry Rules Tighten
UK Signals Possible Seizure of Russia-Linked ‘Shadow Fleet’ Tanker in Escalation of Sanctions Enforcement
Epstein Scandal Piles Unprecedented Pressure on UK Prime Minister Keir Starmer’s Leadership
UK’s ‘Most Romantic Village’ Celebrates Valentine’s Day and Explores the Festival’s Rich History
The Implications of Expanding Voting Rights to Non-EU Foreign Residents in France
Ghislaine Maxwell to Testify Before US Congress on February 9
Al.com Acquired by Crypto.com Founder for $70 Million
Apple iPhone Lockdown Mode blocks FBI data access in journalist device seizure
Belgium: Man Charged with Rape After Faking Payment to Sex Worker
KPMG Urges Auditor to Relay AI Cost Savings
US and Iran to Begin Nuclear Talks in Oman
Winklevoss-Led Gemini to Slash a Quarter of Jobs and Exit European and Australian Markets
Canada Opens First Consulate in Greenland Amid Rising Geopolitical Tensions
China unveils plans for a 'Death Star' capable of launching missile strikes from space
NASA allows astronauts to take smartphones on upcoming missions to capture special moments.
Trump administration to launch TrumpRx.gov for direct drug purchases
Investigation Launched at Winter Olympics Over Ski Jumpers Injecting Hyaluronic Acid
U.S. State Department Issues Urgent Travel Warning for Citizens to Leave Iran Immediately
Wall Street Erases All Gains of 2026; Bitcoin Plummets 14% to $63,000
Epstein Case Documents Reignite Global Scrutiny of Political and Business Elites
Eighty-one-year-old man in the United States fatally shoots Uber driver after scam threat
UK Royal Family Faces Intensifying Strain as Epstein-Linked Revelations Rock the Institution
Political Censorship: French Prosecutors Raid Musk’s X Offices in Paris
AI Invented “Hot Springs” — Tourists Arrived and Were Shocked
Tech Mega-Donors Power Trump-Aligned Fundraising Surge to $429 Million Ahead of 2026 Midterms
UK Pharma Watchdog Rules Sanofi Breached Industry Code With RSV Vaccine Claims Against Pfizer
Melania Documentary Opens Modestly in UK with Mixed Global Box Office Performance
Starmer Arrives in Shanghai to Promote British Trade and Investment
Harry Styles, Anthony Joshua and Premier League Stars Among UK’s Top Taxpayers
New Epstein Files Include Images of Former Prince Andrew Kneeling Over Unidentified Woman
Starmer Urges Former Prince Andrew to Testify Before US Congress About Epstein Ties
Starmer Extends Invitation to Japan’s Prime Minister After Strategic Tokyo Talks
Skupski and Harrison Clinch Australian Open Men’s Doubles Title in Melbourne
DOJ Unveils Millions of Epstein Files, Fueling Global Scrutiny of Elite Networks
France Begins Phasing Out Zoom and Microsoft Teams to Advance Digital Sovereignty
×