The increase in minimum auto-enrolment (AE) contributions has had little impact on opt-out rates - with cessations after April increasing by less than two percentage points, data from The Pensions Regulator (TPR) shows.
In April, minimum AE contribution rates increased from a total of 2%, with a 1% minimum employer contribution, to a total of 5%, with a 2% minimum employer contribution.
The survey results outlined in the watchdog's Auto-enrolment ongoing duties report published on 11 October found that when the rate went up, the cessation rate - the mean proportion of members asking to leave the scheme across all employers implementing increased contributions - was just 1.8% for micro, 1.7% for small, and 0.9% for medium employers.
The regulator identifies firms with 50 to 249 staff as medium-sized, those with five to 49 as small, and businesses with one to four staff as micro.
These figures were based on a survey of 300 micro, 300 small and 200 medium-sized employers, conducted between 1 June and 12 July this year.
The findings complament a similar set of figures unveiled by the Pensions and Lifetime Savings Association (PLSA), which revealed the opt-out rates of three master trusts - NEST, Now Pensions and The People's Pension.
It showed that the proportion of people who stopped contributing to their pension increased by just 0.2 percentage points in the three months after the April increase.
Commenting on the PLSA's analysis, secretary of state for work and pensions Esther McVey said: "These figures show that AE is working and transforming retirement for millions of people. The proportion opting out or ceasing saving remains low as contribution rates increase, helping people save markedly more for their retirement."
TPR's study also found the majority of employers identified the process of implementing the increased contributions as ‘easy'. This was the case for 72% of micro, 75% of small, and 71% of medium employers.
Just 6% of micro, 4% of small and 12% of medium employers found the process ‘difficult'.
TPR's report said these respondents were more likely to highlight issues with working out how to implement the changes on their existing software. Other reasons they gave included finding the time, a lack of support or information and difficulty calculating the increased contributions.
Meanwhile, the same study found that the majority of employers were aware of the upcoming 6 April 2019 contribution rate hike, to a total of 8%, with a 3% minimum employer contributions.
This was the case for almost half (46%) of micro employers, 69% of small, and 87% of medium employers. Knowledge of the date of the increase was comparatively lower in all cases, with 32% of micro, 52% of small and 74% of medium employers able to correctly identify the increase date.
The regulator's study further showed most employers thought that the increases in minimum contribution levels over the two years were a good idea (59% of micro and small, and 74% of medium employers).
The same analysis found that awareness of ongoing AE duties ranged between 93% and 100%. This was the case for 88% of micro, 89% of small, and 98% of medium employers.
The majority of employers said they did not have any difficulty keeping up with their duties (78% of small and 82% of medium employers). Furthermore, almost all of the employers were confident that their organisation was fully compliant with their duties. This was the case for 97% of micro, 98% small, and 99% of medium employers.
Commenting on the findings, TPR Director of AE Darren Ryder said: "It's great news that employers are continuing to find their ongoing duties quick and easy to do, staff are saving more and we are continuing to build on the success of AE."
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