UK taxpayers face "benefits timebomb" over falling pension contributions

The number of people who are members of occupational pension schemes fell by 500,000 between 2009 and last year, new figures from the Office for National Statistics (ONS) have revealed.

Meanwhile, active membership continues to fall, the analysis added, with just 8.3 million employees paying into schemes at the lowest level for more than 60 years.

Of that total of active members, 5.3 million were in public sector schemes and 3.0 million were in private sector equivalents.

Dave Prentis, general secretary of trade union Unison, said that taxpayers face a "huge benefits timebomb" because too few people are saving for their financial futures.

According to pensions experts, the dramatic fall in the number of people saving in recent years is a direct result of squeezed household budgets and rising unemployment.

Joanne Segars, chief executive of the National Association of Pension Funds, commented: "Those who quit their pensions could be storing up cash problems for later in life. Unemployment is partly to blame, but many who have a job are struggling with household finances and the rising cost of living.

She added: "People are thinking about today and putting tomorrow on hold and unfortunately saving into a pension is being seen as a luxury."

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