Start retirement saving now or the UK government may make you
The Department of Work & Pensions told Reuters it had no plans to introduce mandatory private pension saving, but it did need to compel millions more people to save.
The DWP said it expected 70 percent of people would stay in a workplace scheme and hoped to see 4.3 million savers in retirement schemes by May 2015 and between 6-9 million by 2018.
"One way or another, long-term pension contributions will increase," Paul Macro, defined contribution retirement leader at Mercer said. "The government are trying to stop people relying on the state to support them in retirement."
Under Britain's current so-called auto-enrolment system, employee and employer both contribute 1 percent of pay into a pension. But this will gradually increase to 5 percent from the employee and 3 percent from the employer by October 2018.
Someone earning 26,200 pounds ($41,400) a year, for example, would generate 4,667 pounds of employer contributions over 10 years, based on the auto-enrolment pension contribution guidelines, according to estimates by fund manager Fidelity Worldwide Investment.
Companies with more than 120,000 employees were required to start auto-enrolment in the second half of last year. For small firms employing between 50-89 staff the deadline is July 2014.
Eleven big companies, including supermarket chains J. Sainsbury and WM Morrison have introduced the scheme. But other large firms have not done so yet.
A spokesman for Morrisons told Reuters that one-fifth of their qualifying
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