14/01/2013

Pension poverty beckons as confusion reigns for community and voluntary workers

After a lifetime of dedication to helping others, community and voluntary sector workers are destined to retire into poverty, UNISON, the UK’s largest union is warning today.

A survey of more than 2,000 of its members working in the third sector revealed widespread confusion about pensions, as well as a lack of quality employer pension schemes on offer. A significant number of employers (84%) offer a workplace pension scheme but 42.7% of staff were not in it, with many respondents saying that they could not afford to join one.

There is a very real danger that when auto-enrolment into pension schemes comes in this year, the combination of low pay and the pay freeze will inevitably lead to large scale opt-outs, as workers will simply not be able to afford the contributions.

“Poor pay, lack of clarity and poor pension schemes are a toxic combination” said Simon Watson, UNISON’s National Officer for Community and Voluntary sector workers. He went on to say:

“There is a very real danger that after many years of working to help others, third sector workers will find themselves struggling to keep out of poverty in their retirement.

“It is vital that we get the message over to both employers and workers that a decent pension scheme means the difference between dignity in retirement and just scraping through by relying on state benefits. UNISON is calling on employers in the third sector to work with the union to identify and implement good quality pension schemes, including those that carry the pensions quality mark and pensions quality mark plus. The union is holding a one-day seminar in February for community workers to try and bridge the pension knowledge gap.



Key Survey Findings

· 83% of employers offered a pension to new staff. In 23% of cases this was a defined benefit scheme, in 24% of cases it was a defined contribution scheme, and in 52% the respondents did not know.

· 42% had NOT heard of pensions auto-enrolment before

· 46% did NOT know what it would mean for them

· 51% said they wanted help in financial planning, including pensions