Commenting on the pensions implications for gig workers following today's publication of the Matthew Taylor review, Philip Smith, workplace savings leader at PwC, said:
"The review's focus on today's evolving workforce shines a light on the many complexities of modern working practices. While there is rightly a lot of attention on how workers such as those working in the gig economy are treated today, more focus need to be placed on how these workers will fund their retirement in future.
"Despite enrolling nearly 8 million people into a workplace pension since its inception, auto enrolment only applies to those who are employed, aged 22 and earning at least £10,000 a year. The self-employed are not yet required to contribute, and this is a problem for many thousands of gig economy workers. Without any employer to enrol them, many of the self-employed are unlikely to voluntarily save for their retirement.
"We welcome the review's suggestion of using the current system to make effective changes, perhaps by auto-enrolment via the self assement process. Self employment has been one of the economy's key growth areas, and the lack of long-term saving highlighted in the review risks storing up problems that will need addressing if we are to ensure all workers have a chance of achieving a reasonable and comfortable retirement.
"The Government has already announced that the subject of gig economy workers and the self employed will be part of the DWP's comprehensive review of auto-enrolment regulations this year. Finding a way to ensure that all areas of the workforce benefit from the success of auto-enrolment is an area that urgently needs addressing if we want the UK to have a pension system that provides an adequate retirement for all."
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