Financial resilience is one of the most pressing challenges for the UK

Published  08 February 2022
   4 min read

Commenting on the All Party Parliamentary Group’s call for evidence on Financial Resilience Sarah Pennells, Royal London’s consumer finance specialist, said:

“Financial resilience is one of the most pressing challenges as the UK emerges from the pandemic. The cost of living increases are a major source of financial anxiety for a significant number of people and the pandemic has served to exacerbate these concerns.

“The financial pressures facing individuals are, rightly, the main focus for policymakers at present. However, it is also the case that many people – in particular women and the self-employed - are still not saving enough to achieve an adequate level of income in retirement. As such, is important that we don’t neglect the issue of helping people to build greater financial resilience over the longer-term.

“Given the challenging economic circumstances, it would not be appropriate to increase mandatory automatic enrolment contributions in the immediate aftermath of the pandemic. Instead, we would urge the Government to focus on implementing the Department for Work and Pension’s proposed changes to the eligibility criteria for automatic enrolment, so that more lower income workers are enrolled into workplace pensions and develop the habit of saving for retirement.

“It is also important to ensure the swift implementation of the Net Pay tax anomaly solution by HMRC, to address the issue of workers – mainly women - who earn less than the personal tax threshold missing out on tax relief on pension contributions. The proposed solution, whilst welcome in principle, means that in practice impacted customers will not be able to claim top ups until the 2025/26 tax year. This prolonged implementation timetable seems unnecessary and will disproportionately impact women.”





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  • Our research suggests that Covid-19 caused people to rethink their financial priorities and, as a result, pension contributions declined in the first twelve months of the pandemic.
  • In 2020 our research found one in five (19%) of those who contributed to a pension either reduced (11%) or stopped (8%) payments, with millennials being the most likely to do so (40%).
  • More encouragingly, when we conducted the research in 2021, we found that pension savers were restarting their contributions. Three in five (59%) workers who made reductions due to the pandemic had since increased their payments, including more than one in ten (12%) who had restarted contributions after stopping them altogether during the pandemic.
  • Interestingly the older the participant, the less likely they were to have restarted their contributions after stopping or reducing them. Three in four (77%) of those aged 18-34 had since increased or restarted contributions, compared to half (51%) of those aged 35-54 and just one in ten (9%) of those aged 55+.
  • There was also a notable gender divide, with fewer than half of women restarting their pension contributions, compared to over two thirds of men. This is concerning given that multiple studies have shown that women retire on a lower income than men.

Notes to Editors

  1. Opinium, on behalf of Royal London, carried out two pieces of research in 2020 and 2021 into how the pandemic affected peoples’ pension contributions. The research in 2020 surveyed 2,000 UK adults and was carried out between 9 to 12 June. The second piece of research was conducted between 3 to 7 September 2021 and also surveyed 2,000 UK adults. Research carried out by Opinium on 2,000 UK adults between 3rd - 7th September 2021.
  2. Read Royal London’s full response to the Financial Resilience consultation. Please email for a copy.

About Royal London

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £153 billion, 8.8 million policies in force and 4,075 employees. Figures quoted are as at 30 June 2021.