Contributions to personal pensions have plunged by more than £2 billion as the number of people contributing fell during the recession.

Total contributions to UK pensions pots declined from £20.9 billion in 2007/08 to £18.7 billion in 2009/10, according to figures released by the Office for National Statistics (ONS).

Many people who had been making small payments to personal pensions stopped contributing altogether when the economic downturn hit, the ONS said in its report Pension Trends Chapter 8: Pension contributions.

The number of people paying into personal and stakeholder pensions in 2008/09 was estimated to be 6.4 million, down from 7.6 million the previous year.

Darren Philp, director of policy at the National Association of Pension Funds (NAPF), said, ‘It is understandable that people have more pressing financial priorities during difficult times, but contributing to a pension regularly is vital to ensure a decent income in retirement.

‘The UK’s population is on a collision course with its own retirement. People are not saving enough and millions risk facing poverty in their old age.’

The ONS also published a report on pensions trends, examining the differences between provision in the public and private sectors.

Some 56 per cent of active members of private sector defined benefit schemes were in schemes closed to new members in 2009, the report revealed, compared to the majority of public sector workers who were still able to join a defined benefit scheme.