A senior Department for Work and Pensions (DWP) minister has delivered a stark warning to millions of people across the UK about their pension saving habits. Torsten Bell, pensions minister and Labour MP for Swansea West, spoke out this week following a report raising concerns that a significant number of Britons are not adequately covered by the pension system.
Mr Bell emphasised the urgent need for better pension saving among large sections of the population, particularly the self-employed, who comprise over four million workers according to IPSE, the association for self-employed individuals. Without improved saving behaviour, he cautioned, many in their 40s today could face a much less secure retirement by 2050 compared to current retirees.
“The blunt truth is that collectively we are not saving enough to ensure that today’s workers, tomorrow’s pensioners, have a comfortable retirement,” Mr Bell noted in his latest newsletter.
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He highlighted that projections currently indicate those retiring in 2050 could receive private pension incomes roughly 8% lower than today’s retirees. This is a worrying trend given the UK’s ageing population, with numbers over 75 expected to double by 2075, and runs counter to what should be considered progress.
The issue centres particularly on private pensions and their uptake among the self-employed, who lack an automatic workplace pension enrolment system. The Society of Pension Professionals (SPP) recently published a report titled “The Missing Millions: Rethinking Pension Policy for the Self-Employed,” calling for a fundamental review of how to support self-employed workers in building adequate retirement savings.
The SPP’s paper points out the distinct challenges faced by the self-employed, including the absence of employer contributions and payroll systems that make saving easier for employed workers. Irregular incomes mean fixed monthly pension contributions are often impractical, creating barriers to consistent saving.
Furthermore, approximately three-quarters of UK private sector businesses are owned solely by individuals without employees, representing a large group vulnerable to pension system gaps.
Recommendations from the SPP include leveraging the tax system to create default pension saving options and expanding tailored pension arrangements for the self-employed.
The Pensions Commission, established by the government in July 2025, has echoed these concerns. Its interim report, released in May, highlights a widespread problem of inadequate retirement saving, especially among low-to-middle earners, the self-employed and women. The Commission warns that without intervention, the number of people under-saving could rise from 15 million to 19 million, putting many at risk of financial hardship in retirement.
Helen Morrissey from investment platform Hargreaves Lansdown commented: “The self-employed are not covered by auto-enrolment, so all the work of finding a pension provider and making investments falls solely on them. Most simply do not engage. For those with fluctuating incomes, the fact that pension savings are locked away until at least age 55 (rising to 57 in 2028) can discourage saving, leading them to seek alternative options.”
Mr Bell has long been engaged in pension policy, previously leading the Resolution Foundation think tank and co-authoring a 2023 report advocating a 50% increase in minimum pension contributions to build on the success of auto-enrolment.
He highlighted the benefits of pension saving: “For every £1 a worker saves, they can expect around £4 back in retirement (approximately £8 before inflation adjustments). This happens because tax relief adds 25p per £1 saved, employers contribute at least 75p, and the pension fund grows over time through investment returns and the power of compound interest.”
Mr Bell affirmed his commitment to pension reform, assuring that the current government under Andy Burnham will act on the Pensions Commission’s recommendations to better secure the retirement futures of millions.
This message underscores growing concerns that without significant changes, many UK workers risk facing more precarious retirements in the coming decades.