8 July 2013

Auto-Enrolment - some staggering numbers

Small businesses are not renowned for jumping at the opportunity to satisfy legislation. I know - I've been running a small business one way or another for quite a few years. It's just that there are better things to do, like trying to earn a living for you and your staff.
I've blogged before about Auto-Enrolment pensions and the various requirements it imposes on all employers (go to the main Money At the Speed of Life website if you're not there already - and find the Auto-Enrolment label on the right to find relevant blogs). But although the process has started already for larger employers, it will be 2014 and 2015 when it hits the vast majority of UK companies.
Given that there are around 11 million workers to be enrolled in pension schemes by the end of the process (by the DWP's estimate), that means a vast number of employers who will need to set up a new pension scheme in most cases.

At its peak, there will be 132,000 small companies per month who need a new pension scheme and all the associated processes to enrol staff.
But here's the problem, how will smaller employers know how to find the best pension for their staff, and to decide on the most cost-effective pension contribution strategy? There are not going to be enough advisers to go round and recommend what to do for everyone (and make no mistake this is complex stuff, with lifelong implications for staff).

All I can suggest to anyone is to start planning early. It could take 12 months to design and arrange a pension scheme which is really going to be beneficial to staff, so even if your "staging date" is not until 2014 or 2015, now is the time to think about it.

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