Consulting Report
07 Feb 2024

Exploring the implications of higher pension contributions in the UK

In collaboration with Royal London

Exploring the implications of higher pension contributions in the UK

Most private sector employees fail to save adequately for retirement, despite the implementation of automatic enrolment and recent legislation to expand the scope of this scheme. In this study, Oxford Economics has collaborated with Royal London to assess the impact of a range of mandated pension contribution increases at the household and macroeconomic level.

Our analysis indicates that only 40% of households with a pension in a defined contribution (DC) scheme will be on track for a “moderate” lifestyle in retirement by 2040. We show that higher pension contributions could improve the adequacy of pension savings and boost UK GDP by £0.4 to £7.4 billion in 2040, compared to our baseline. However, we also highlight that poorer households may find it challenging to afford higher pension contributions―an important consideration for any potential policy reform.

The experts behind the research

Our economic consulting and macro consulting teams are world leaders in quantitative economic analysis and original, evidence-based research, working with clients around the globe and across sectors to build models, forecast markets, run extensive surveys, and evaluate interventions using state-of-the art techniques. Lead consultants on this project were:

Ben Skelton

Lead Econometrician, Economic Consulting

Henry Worthington

Director, Economic Consulting

You might be interested in

Impact AI: Enterprise AI Maturity Index 2024

Oxford Economics and ServiceNow fielded a global survey of 4,470 executives at organizations where artificial intelligence capabilities are in use.

Find Out More
The Hidden Costs of Downtime: The $400B problem facing the Global 2000

Downtime and service degradation create a cascade of consequences, costing Global 2000 companies $400B annually. But that figure doesn’t account for what’s below the surface. The actual cost is much larger when we consider downtime’s broader impacts.

Find Out More
Climate Change and Food Prices in Southeast Asia: 2024 Update

This report highlights the vulnerability of food production cost in ASEAN given the impending physical and transition risks of climate change. It also highlights the critical policy response at domestic and international level to support the transition.

Find Out More
Economic Impact of NCIS: Hawai’i Season Two

Across 2022-23, production of Season Two of “NCIS: Hawai’i” resulted in total spending in the state of approximately $79.4 million.

Find Out More