Staff who pay nothing must contribute, others must increase
Britain's biggest insurer Aviva has scrapped free pensions for almost 16,000 staff, asking those who pay nothing to chip in for the first time and increasing contributions from all staff.
The 15,900 members of Aviva's defined contribution pension scheme have not had to make any contributions until now, but, from July, they will have to pay at least 1% of their salary until next April and 2% after that.
In return, Aviva will increase its maximum contribution to the pension scheme from 12% to 14%.
Only staff who contribute the maximum 8% of salary to the scheme each year will trigger the biggest contribution from Aviva. The new terms will apply across the group.
Aviva confirmed the changes to Insurance Times. A spokesperson said: “The company’s contributions are very generous. For those not saving anything themselves we currently pay 8%.”
Aviva is also asking the 7,249 members of its final-salary pension scheme to increase their contributions from 5% to 10% over two years or consider leaving the fund. The minimum will be 6% of salary but will result in a lower pension or staff can choose to leave the fund.
Aviva said that it was imposing contributions on staff to encourage them to save and emphasised that it would not be cutting the amount that it paid into the scheme.
The changes affect all Aviva’s UK companies.
