Half of UK permanent workers would increase contributions to their workplace pension if employers paid a larger share, according to Scottish Widows’ latest Retirement Report.

The research, carried out by YouGov in February, found exactly 50% of workers would contribute more if employer contributions increased. If minimum contribution rates rise in future, 34% said they would contribute between 6% and 8% of salary, while 20% would be willing to contribute between 8% and 10%.

Support for higher employer contributions was stronger than for employee increases, with 66% backing higher minimum employer contributions compared with 42% supporting higher employee payments.

Workers in their 20s were most supportive at 68%, although support remained elevated among over-50s at 61%.

Scottish Widows estimated that raising total contribution rates from 8% to 12% on the first £30,000 of salary could increase projected retirement savings by an average of £40,000.

However, financial pressures remain a constraint. The pensions and insurance provider said more than half of employers had been prevented from increasing pension contributions due to rising operating, staffing and utility costs.

The report also revealed a persistent pensions knowledge gap. Some 41% of workers did not know how much they contribute each month, 30% said they did not understand how pensions work and 36% were unsure how much they should be saving. More than half had carried out little or no research into retirement planning.

Graeme Bold, managing director, workplace and intermediary wealth at Scottish Widows, said "Automatic enrolment has been a real game changer for how Britain is building pension wealth, bringing millions of people into pensions who wouldn’t have saved otherwise. But the next phase is a challenge, as while half of workers are ready to put more aside if their employer steps up too, but businesses are already up against financial pressure across the board."

Bold added: “The reality remains that too many people are still at risk of falling short in later life, with around a third facing a financial struggle in retirement."

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