The minimum Auto Enrolment Contributions are being increased from 6th April 2018.

Until now the minimum levels of contribution have been 1% from the employer and 1% from the employee. From the 6th April, the levels of contribution will increase to 2% from the employer and 3% from the employee.

The levels will increase in 12 months time to 3% from the employer and 5% from the employee.

Next year the total payment will, therefore, be a very meaningful 8% and such contribution levels will inevitably produce a much greater pension provision than would be achieved by continuing with the current levels. However both employers and employees will feel the pinch by the greater payment being made by employers each month from now, whilst employees will notice a reduction in their take-home pay.