A majority of employers, 62 per cent, would consider redirecting their employer pension contributions to a LISA depending on the tax treatment of the contributions, Jelf Employee Benefits has found.

Its Jelf Employee Benefits Survey 2017, which uses data gathered from its employment seminars from across the country, found that one in ten employers would definitely be willing to redirect their contributions to a LISA, and a further 62 per cent would depending on the tax treatment.

Interestingly, just 6 per cent of those questioned rejected the idea altogether and 21 per cent said they did not know.

However, the report noted that on a practical level there are issues with this, such as the cost of doing so and the requirements to comply with auto-enrolment. Despite this, Jelf believes that these results show that UK employers are willing to embrace a wider savings culture should legislation and tax treatment of contributions allow them to do so.

Commenting, Jelf senior corporate consultant Peter Matthews said: “The proposed new LISA idea is a welcome addition to the savings toolbox for employees. That said, it should be highlighted that LISA is not truly a pension savings plan.

"It is important that the survey findings show that nearly two thirds of employers understand the tax efficiency advantages of pensions when saving for retirement (not to mention the added advantages of contributions paid via Salary Sacrifice also). This message, consideration, and understanding must be cascaded to employees so that they can make fully informed decisions.”

Jelf head of workplace savings Nick Allen added: “If interest in LISA does take off, employers may not have the workplace savings vehicle in place to accommodate it. Early discussions with employers on this topic suggest they will either point staff to independent, standalone providers or consider an integrated LISA into existing or new workplace savings platforms.”

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