The government’s response to the Taylor Review into working practices is a good first step, but has failed to address issues surrounding pensions for the self-employed, experts have warned.
The government has promised an overhaul of employment rights to improve conditions for millions of workers, including those in the gig economy.
The changes include stricter enforcement of holiday and sick pay rights, and higher fines for firms that breach contracts or mistreat staff.
It said the reforms were in response to the Taylor Review, which investigated what impact modern working practices are having on the world of work.
Published on 11 July 2017, it suggested the self-employed should be auto-enrolled into a pension scheme through the self-assessment process.
Business secretary Greg Clark said: “We want to embrace new ways of working, and to do so we will be one of the first countries to prepare our employment rules to reflect the new challenges.”
However, Aegon head of pensions Kate Smith said while she welcomed the government’s plan to give gig economy workers greater clarity on their employment rules and rights, it had failed to address the issues surrounding pensions.
“In the UK pension provision is largely delivered through the workplace, via auto-enrolment, so the self-employed, including gig-economy workers are currently excluded. The right to an employer contribution should be carved in stone for all workers,” she said.
“[The] government needs to grasp the nettle and address this growing savings gap before it’s too late.”
Issue ‘kicked into the long grass’
Royal London director of policy Steve Webb similarly felt the government had missed the mark on offering the self-employed help with their pensions.
“Despite Matthew Taylor’s recommendations, the government’s response offers little hope for improving the pensions of the self-employed,” he said.
“Pension membership among employed workers has soared because of automatic enrolment, but it remains shockingly low for the self-employed.
“It is very worrying that this issue has again been kicked ‘into the long grass’, meaning that millions of self-employed people face an insecure retirement,” he added.