Most employers do not think they are getting value for the money they spend on pensions provision.
According to PricewaterhouseCoopers’ Fourth annual PWC pensions survey, 83% of employers are either very or somewhat concerned about the lack of value they get for their money.
More than three-quarters (79%) of respondents are also concerned about the impact their pension scheme had on their overall reward strategy. For example, if an organisation’s reward is based on success, a pension scheme where contributions are based on employees’ age or length of service would not fit with its overall strategy.
Some 90% of respondents said they were also concerned about the impact of pension schemes on employee relations. Marc Hommel, partner and UK pensions leader at PWC, said many employers were reluctant to make changes to their scheme in case they harmed staff relations. “People start caring when you take something away and making changes to pension schemes can be seen as a breach of trust,” he said.
Despite this, nearly one-fifth (17%) of respondents said pensions provision had grown in importance over the past three years in terms of attracting and retaining senior executives. A further 19% said schemes had become more important in recruiting and retaining all other staff.