Debate contribution: Pensions (Extension of Automatic Enrolment) Bill: Final Stage

Debate contribution by Mr Gordon Lyons on 3 March 2025.

MLA

Mr Gordon Lyons

Party at the time

Democratic Unionist Party

Date

3 March 2025

Type

Debate contribution (made as a minister)

Business

Executive Committee Business

Heading

Pensions (Extension of Automatic Enrolment) Bill: Final Stage

Assembly identifier

Official Report component 4826423

Read the official Assembly record

Text

I beg to move

Thank you, Mr Deputy Speaker. I thank the Committee and Members from across the House who have supported the Bill and its progression through the Assembly. Since the introduction of automatic enrolment in 2012, there has been significant growth in the membership of workplace pensions, and saving for retirement has become normal. In 2013, the proportion of employees in Northern Ireland who belonged to a workplace pension scheme was 44%. By April 2023, that figure had increased to 75%. Workers can choose to opt out of automatic enrolment. However, every three years, an employer must re-enrol those eligible employees who exercised their opt-out of automatic enrolment with that employer. The percentage of employees in Northern Ireland aged 22 to 29 who are members of a workplace pension scheme has increased from 25% in 2012 to 76% in 2023. Over the same period, membership of a workplace pension scheme among those aged 17 to 21 has increased only from 1% to 16%. The Bill provides the power to lower the age for automatic enrolment from 22 to encourage saving for retirement from an early age. That helps to continue to normalise pension saving among workers and, of course, to simplify automatic enrolment processes for employers. Employees will be able, as they are now, to opt out of automatic enrolment. The Bill also provides my Department with the power to make regulations to reduce or repeal the lower limit of the qualifying earnings band. Removing the lower limit of the qualifying earnings band means that pension contributions would be made from the first pound earned, thereby increasing total pension saving and simplifying contribution calculations for employers and individuals. That improves the incentives for those in multiple jobs to opt in to their workplace pension scheme, as they will benefit from an employer contribution for every pound that they earn in every job up to the upper limit of the qualifying earnings band. That will proportionately affect the contributions of lower earners the most. It means that more workers will have access to a pension with an employer contribution and greater pension pots, supporting those with lower earnings and multiple jobs. Given the UK-wide nature of the changes, my Department will work in tandem with DWP to ensure that an effective communication strategy is in place and, in particular, that young people are aware that automatic enrolment will begin at a younger age and of the advantages of starting pension saving at an early age. Similarly, workers in general will be made aware of the changes to the minimum level of the qualifying earnings band and what it means for pension saving. Finally, the Bill provides a requirement for my Department to review, report and:

"lay before the Assembly a report setting out its assessment of the effects of any changes ... at least 36 months, and no more than 42 months, after the coming into operation of the first regulations".

In summary, the Bill gives my Department the power to lower the age at which qualifying workers are automatically enrolled in a workplace pension and the power to reduce or repeal the lower limit of the qualifying earnings band so that contributions are calculated on more of a person's earnings. Additionally, the Bill requires the Department to review and report its assessment of the impacts of any changes after the first regulations come into operation. By most standards, automatic enrolment can, I think, be considered a success. The measures in the Bill are intended to continue to normalise pension saving among workers, help more earners to build resilience for retirement, support individuals in multiple part-time jobs and simplify automatic enrolment for employers. Therefore, I commend the Bill to the Assembly.

622 words. Text as published by the Northern Ireland Assembly.

Assessment

Not flagged

Jev’s structured answers

Assessed 21 October 2026 at 12:07 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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