Half (50%) of workers would pay more into their workplace pension if their employer also paid a larger share, according to a new report.
If minimum contribution rates were to rise, over one in three workers (34%) would be willing to contribute 6%-8% of their salary.
A fifth would be happy to contribute 8%-10% of their salaries, according to Scottish Widows’ Retirement Report.
Increasing total contribution rates from 8% to 12% on the first £30,000 of salaries could boost projected retirement pots by an average of £40,000, says Widows.
Two in three of the workers surveyed (66%) were in favour of the Government raising minimum employer pension contributions, compared to 42% asked about increasing employee contributions.
Despite workers being willing to up their contributions, the report found that understanding of and engagement with retirement savings was still low, with 41% having no idea how much they contributed each month to their pension.
A fifth (19%) of workers said they believed their employer contributes nothing at all, while three in ten (30%) admitted they did not understand how pensions work.
More than a third (36%) did not know how much they should be saving and around a quarter (26%) were unsure of what to do with their money.
The report found that despite demands from workers, firms were not planning on increasing their contribution rates unless forced to do so.
Cost pressures were stopping firms from increasing their reward and benefit packages. Over half (54%) of the firms surveyed said they are held back from increasing contributions by financial constraints, including managing increased operating, staffing and utility costs.
Graeme Bold, managing director of workplace and intermediary wealth at Scottish Widows, said: "Automatic enrolment has been a real game changer for how Britain is building pension wealth, bringing millions of people into pensions who wouldn’t have saved otherwise. But the next phase is a challenge. While half of workers are ready to put more aside if their employer steps up, businesses are already up against financial pressure across the board.”
• YouGov surveyed 2,329 employed adults in February on behalf of Scottish Widows. Opinium surveyed 1,000 senior decision makers with responsibility over pension schemes on behalf of Scottish Widows.
• Financial Planning Today Analysis: On the positive side, Scottish Widows' report suggests pension savers would chip in a bit more to their pensions if their employers did the same. However, the fact is that most employers are already generous donors to employees' pension schemes. Even so, the fact people are willing to consider an increase is a positive thing. On the negative side, the survey illustrates that ignorance of pensions is huge and this almost certainly holds back the sector and saving hugely. A massive eduction programme and requirement to engage with employees is likely the only way this will change. Employees should get a monthly pension statement with their salary slips, with an explanation of how their pension works and how much it will be worth when they retire. For too long, surveys such as this have underlined widespread pension ignorance among UK workers which is as disappointing as it is worrying. The other aspect of the report to note is that employers are struggling with increased costs themselves, such as Employers' National Insurance and rapid increases in the Minimum and Living Wages. Pensions are another cost for employers and while there is goodwill to fund these there are limits to how far this largesse can extend. Forcing employers to pay more in tax and wages means less money to put into pensions.