“Employment-based savings schemes are known to be the most effective and efficient way for people to save. It is good to see the Government showing leadership as an employer as well as encouraging savings by supporting a savings scheme for public servants.
“By making its contributions dependent on a similar contribution from the employee, the Government is also giving the message that people have to do their bit if they want to save for the long term.”
Kent says AMP’s research had shown the value of access to workplace savings scheme.
“Through our research we know that successful savers speak of putting money away before they see it, while less successful savers try and find the money to save after they’ve paid for everything else. Workplace based savings schemes are clearly critical in helping provide the right environment to encourage savings,” he says.
“Even without making a contribution, employers can do a lot to encourage staff to save simply by having a scheme in place and making it easy for staff to join the scheme and have deductions made direct from their salary. Schemes can now be designed that do not necessarily involve high compliance costs for employers.”
Kent said AMP and others in the financial services industry would be looking forward to seeing the details of the proposed scheme. Savers had different needs depending on what stage of life they were at and it was important that people had a choice of savings plans and flexibility in the amounts and timing of their saving.
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