A third of U.K. employers are set to help participants to use retirement savings for other financial needs over the next two years, up from the current 9%, a Willis Towers Watson survey found.
The survey of 200 benefits executives and pension plan trustees showed that 38% of the largest companies — those with more than 5,000 employees — expect to be offering greater retirement plan flexibility over the next 24 months, up from 6% now doing so. This compares with 32% of midsize organizations (less than 5,000 employees) looking to increase retirement flexibility for employees, up from 11%. The number of small enterprises — less than 1,000 employees — is set to increase to 19% from 8%, said the survey, which was conducted in June and July.
A third of the surveyed executives expect to make increasing the choices offered within benefits packages a priority over the next three years, while another third said they will make adding to existing financial wellbeing programs a priority. Still some 40% of the surveyed executives said they need to maintain the current level of spending on benefits or retirement provision.
Some 37% of employers with open defined benefit funds said they have taken steps to control costs, mainly by increasing participant contribution rates, but named union pressures, legal restrictions and complexity as key barriers to changing their plans' design.
"The picture emerging from this research is one of significant flux both in workplace retirement provision, and in the wider employee benefits package," Minh Tran, director of wealth and workplace savings at Willis Towers Watson, said in a news release about the survey findings.
"While managing cost remains a key factor, organizations of all sizes increasingly are willing to embrace new ways of structuring and delivering benefits. Employers appear increasingly keen to view retirement saving less as a stand-alone issue, and more as an integral part of their employees' wider financial planning and wellbeing and are exploring new ways of delivering this support."