The pension auto-enrolment system was introduced to make it compulsory for employers to automatically enrol eligible workers into a pension scheme. On top of this, the employer would then pay money into the scheme.

“When the living wage goes up it feels like an opportune time to coincide with the removal of the lower limit on qualifying earnings.

“Because the lowest-paid workers will be getting a pay rise, thanks to the increase in the living wage, a small increase in the deduction made for their pension may not be as noticeable.

“Recent data shows that auto-enrolment opt-out rates have remained relatively low. However, the government has remained reluctant to tinker with the policy in order to raise contribution levels and extend participation.