More staff taking part in share saving schemes
Thursday, 22 May 2008 00:01
More employees are joining share savings schemes
More employees than ever are participating in company savings schemes, with five million staff taking up the option to join an employee share plan.
Not-for-profit membership organisation ifs ProShare has released figures from its annual employee share ownership survey showing 2.3 million people participate in a Save As You Earn Scheme (SAYE), up from 1.7 million last year.
A SAYE scheme is a savings-related programme set up by employers under which staff are given a right (known as a share option) to buy a certain number of shares at a fixed price at a particular time.
Some companies also offer a Share Incentive Plan (SIP), which works in a similar way.
The survey found the average amount of money being saved in an SAYE scheme in 2007 rose to £89 a month, up from £71 in 2006, while the average amount of money being saved in a SIP rose to £83 a month, up from £72 in 2006.
The trend of increasing online account facilities has continued, with 62 per cent of companies offering their employees online access to information about the number and value of their SIP shares.
ifs ProShare spokesperson Phil Hall said: "Employee share plans are a relatively simple but effective method of saving, with employees gaining a stake in the company they work for and the opportunity to share in the financial successes of their employer.
"The significant increases in the monthly amount of money employees are saving, in both SIP & SAYE, is especially welcome given the current financial climate."
Retailer Tesco – Britain's biggest employer outside of the government - operates one such scheme.
This year, Tesco reported over 51,000 staff shared its largest ever share payout as the grocer's share price soared over the period of the scheme, netting a 160 per cent return on investment for some participants.
At the time, Tesco chief executive Sir Terry Leahy said: "Save As You Earn schemes are becoming a more popular way to save. One in three staff now save with one of our share schemes and I'm delighted that so many choose to invest and enjoy the rewards of their hard work."