Only 2% of U.K. corporate pension funds with at least 100 participants will sign on to the nationwide NEST defined contribution plan being rolled out, according to preliminary findings of an Aon Hewitt survey.
The investment consultant asked 110 of its corporate clients, whose businesses operate across a wide range of sectors, whether they would use the National Employment Savings Trust or an existing company plan. Ninety-eight percent said they'll stick with their current pension plan.
“Most employers recognize there is a significant degree of change associated with auto enrollment (and that) using their existing provider will typically reduce the amount of change required,” said James Patten, benefits design specialist at Aon Hewitt in an interview.
Plan sizes of those surveyed ranged from less than 100 to more than 30,000 members. “For smaller employers (of less than 100 employees) we are much more likely to see more interest there,” he said.
Tim Jones, CEO of NEST, said more than 100 employers “large and small” have already signed up to use NEST, while “hundreds of thousands” of others, representing as many as 5 million members, are expected to join in the next few years.
“While research like this is always of interest, it doesn't reflect our current experiences with employers,” Mr. Jones wrote in an e-mail.
The Aon Hewitt survey will be completed in early 2012 and can be obtained by e-mailing Mr. Patten at [email protected]