The latest Pension Trends statistics, published today (Tuesday) by the Office for National Statistics, show that the number of people saving in a contract based defined contribution (DC) pension scheme through their workplace has overtaken the number saving in a trust based DC scheme this year.
The figures show that 8.8 per cent of the private sector workforce are now in a contract based DC pension - up from 8.6 per cent last year - while 8.7 per cent are now in a trust based scheme, a fall of 0.2 per cent in a year.
Commenting on the figures, Midlands TUC Regional Secretary Rob Johnston said:
"Few will be surprised at the decline of defined benefit pensions, but the growth of contract DC at the expense of trust based DC should not be over-looked.
"Of course some contract based schemes offer good value and some trust based schemes are not as well run as they should be, but this trend is extremely worrying.
"In a trust based scheme trustees have a single duty - to look after the interests of all scheme members both active and deferred. A contract based scheme in contrast is normally provided by a company seeking to make a return to its shareholders.
"While market forces can often be relied on to keep costs down, decades of experience show that markets don't function when it comes to pension provision - especially as it is not even the consumer that buys a workplace pension, but their employer.
"With the introduction of auto-enrolment bringing a huge increase in DC pension saving over the next few years, we need to ask hard questions about how we can deliver good governance, low charges and sophisticated investment strategies."