Almost half (45 per cent) of employees who do not currently take up the pension they are offered have stated that they do not have the cash to do so, according to Aviva’s second Working Lives report.

Research conducted with over 4,000 private sector employers and employees, showed that only 37 per cent are confident about their financial situation. A total of 19 per cent said that they did not save into a pension because they are repaying debts and 17 per cent stated that they are saving for a house or a holiday.

In addition, 37 per cent of employees said that they will opt out of automatic enrolment and 28 per cent are undecided.

Aviva’s health and corporate benefits managing director Mark Noble said: “Automatic enrolment will only become game-changing if employers, their advisers and the wider industry create sustained communications and engagement in the workplace to encourage employees to save.

“It’s about understanding the needs and the circumstances of the actual employees in each business, not as a single group but in an individual way through face-to-face conversations and personalised planning tools.”

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