An expert has expressed scepticism over whether a planned rise in auto-enrolment contributions will actually take place in April next year.

Malcolm McLean, senior consultant at Amersham-based SIPP provider Barnett Waddingham, expressed his doubts after seeing the terminology used in a Parliamentary question.

Mr McLean said: “It is interesting to note that in the concluding paragraph the DWP is acknowledging that the “Government is closely monitoring the impact of the increases on both employers and individuals to inform our approach to supporting the second planned increase in contributions in April 2019.”

This, he suggested, was evidence the Government could backtrack on the scheduled increase in what he called “a very retrograde step.”.

He said: “Does this suggest the Government may be contemplating delaying, or even cancelling, the further planned contribution increases, from a combined employer/employee rate of 5% to 8% of attributable earnings, next April if this year’s increases are not going down well and causing more contributors to give up on auto-enrolment?”
 
He added: “Many commentators have already expressed concern at the low level of minimum contributions required for auto-enrolment purposes, as of yet there appears to be no clear plan to increase them further beyond 8%.

“Even at this level, for many people, it will not deliver a meaningful pension income at retirement and will call into question the validity of the policy and consumer appreciation of it.”