News from the Reporting Accounts team Sunday 24th January 2021

Adrian Lawrence Podcast

In today's podcast our resident financial professional Adrian Lawrence talks about the concept of a living pension, this is a new proposal from the Rowntree foundation and follows the example of the real living wage foundation, but for pensions rather than wages.
In the UK pensions are made up of the state pension which is capped at £155 per week based on 35 years of contributions and a compulsory private pension known as auto enrolment which is currently set at 8% of a band of earnings, being 4% employee 1% Government and 3% employer.
The issue is that for a 25 year old to get a decent pension the contributions need to be at least 12.5% and higher for someone older and that is based on all earnings. There is therefore a significant shortfall between the current levels of contributions and what is actually required to eliminate pension poverty.
The concept of the living pension is for employers to lead by example and encourage employees to contribute together with their employers the required 12%.
Reporting Accounts supports this approach and believe the Government is moving in this direction albeit slowly already.
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