It’s not only the economy that needs fixing, savers need help too

The rumour mill is in full swing as we edge closer to budget day on October 30. A capital gains tax rise looks more or less certain, while changes to inheritance tax also look likely. Anything to plug that £22 billion fiscal black hole.

Speculation is, however, eerily quiet on the subject of less revenue-raising but more personal matters. Like how to solve our looming pension crisis. We are not saving enough.

An easy fix would be for the government to hand out more money to pensioners — but this looks incredibly unlikely. You only have to look at the winter fuel payment debacle to know that this is not the direction that the chancellor, Rachel Reeves, will take. That means more responsibility needs to be on employers.

Under auto-enrolment most employees pay a minimum 5 per cent of their gross salary into their workplace pension, while employers have to contribute only 3 per cent. Experts say that to build a big enough pot for a decent standard of living in retirement, we should be setting aside at least 12 per cent of our salary.

The Sunday Times launched its Plug the Pension Gap campaign in February, calling for the government to help workers to save for the future and avoid a looming pension crisis. As part of the campaign, we want employers to increase their contributions and make it mandatory for companies to match workers’ contributions.

I’d go even further and say that employers should be required to pay even if an employee isn’t contributing. There are various reasons someone might opt out of auto-enrolment, but lack of affordability is the most common. Why should employees lose out on “free” money from their employer just because they can’t afford to save? Like so many things in the system (take prepayment energy meters for example), it is financially penalising those who are already struggling.

• My message to Rachel Reeves: No more tinkering — it’s time to be bold

The government must also stop dragging its feet on changes to auto-enrolment. The Pensions (Extension of Automatic Enrolment) Act passed by parliament last year includes plans to extend auto-enrolment to workers aged between 18 to 21 and those on more modest incomes. But while the news was launched to much fanfare, nothing has happened since. Meanwhile, 4.25 million self-employed workers are left to fend for themselves when it comes to their pensions. We desperately need a strategy to help them to save for their future.

Then we need to think long term. If the government wants to encourage more of us to save for 40-odd years, we need pension legislation that can stand the test of time. Setting up an independent cross-party commission to look at long-term and sustainable pension reform is the way to go.

There is talk that the budget could include capping the tax-free lump sum that you can take from your pension at £100,000, or introducing inheritance tax on pensions. These measures may well help to plug the fiscal hole in the country’s balance sheet, but what about the fiscal holes that many pensioners are faced with now — and millions more will face in the future? We need to plug those too.

Respects to the father of personal finance journalism

Sir Patrick Sergeant, a renowned City journalist, investor and businessman, has died at the age of 100.

Sergeant believed that personal finance tips and advice should be available to everyone, not just the City boys. So in the late 1960s, as the City editor at the Daily Mail, he launched Money Mail. The “family finance” page became the first personal finance section in any newspaper.

He appointed Margaret Stone to edit those pages, and and she went on to Business at The Times, and the precursor of our Money section, which has since helped millions of readers to manage their finances.

Sergeant was renowned for being impeccably turned out and also for drinking a glass of champagne every day — right up until his death on September 18. Here’s to Patrick.@JohannaMNoble