From April next year workers earning £10,000 or more will be automatically enrolled into their company pension scheme, the Department for Work and Pensions has revealed
It is a rise from the £9,440 earnings trigger, but will mean that around 170,000 fewer workers will be eligible for automatic enrolment - 120,000 of these are thought to be women.
But the DWP said these workers would still be able to 'opt-in' and will receive an employer contribution as long as they earn above the lower limit of the qualifying earnings band.
A DWP spokesperson said: 'It's worth remembering people earning over £5,700 can opt into a pension scheme if they wish, and receive an employer contribution.
'For individuals earning under £10,000, the benefit of directing current income into pension saving may not be of benefit when the new Single Tier State Pension will already provide them with an income in retirement similar to that in working life.
'Under automatic enrolment millions of low paid workers will have the chance to save in a workplace pension for first time, and receive a contribution from their employer.'
But Tom McPhail, head of pension's research at Hargreaves Lansdown, warned: 'There is an increasing risk that failure could yet be snatched from the jaws of success. Millions of workers are being excluded from the enrolment process and many of those who are being put into a pension won't be saving enough. Auto-enrolment has not eliminated the need to communicate effectively with all employees and to engage them in planning for retirement.'
He said that the government was increasingly in danger of making the same mistake as the previous government did on stakeholder pensions in 2001, by assuming that low cost is a guarantee of a successful outcome.
'[The government] can have all the price caps and defined ambition ideas [it] like[s] but if [it doesn't] get people to spend less and save more it will all be a waste of time.'
