One in five employers will not seek Auto Enrolment advice
The Pensions Regulator (TPR) has published guidance to help the 1.3m small and micro businesses preparing for auto-enrolment find a good quality scheme, after 20% said they will not seek advice.
Its recent research suggested that one in five (290,000) employers will not seek advice when choosing a pension scheme, while one in 10 (130,000) do not know how to select a scheme, or think it will be difficult.
The Regulator is updating the suite of information and tools on its website to make it as straightforward as possible for smaller employers, many of which have little or no experience of pensions, to get automatic enrolment right.
For the first time, there will be an online a list of ‘master trust’ pension schemes open to employers of all sizes and which have been independently reviewed to prove they are administered to a high standard.
The voluntary master trust assurance framework was developed by the Institute of Chartered Accountants of England and Wales in association with TPR to enable auditors to provide independent assurance on scheme quality.
Updates to website pages for IFAs and accountants have also been published.
Lesley Titcomb, TPR’s chief executive, said
She strongly believes that the vast majority of small and micro-employers approaching auto-enrolment want to do the right thing. However, many will choose not to seek advice and will need additional support to meet their duties.
She noted that their research shows large multi-employer pension schemes such as master trusts and group personal pensions are better placed to meet the standards necessary for good retirement outcomes.
The list we have published today will help employers more easily identify master trusts that have demonstrated they can deliver quality standards, alongside other schemes including Nest [National Employment Savings Trust]. I strongly urge other master trust schemes to follow the lead of those which have already committed to the voluntary assurance framework so that the choice of quality schemes available for employers continues to grow.
Morten Nilsson, chief executive of master trust Now: Pensions, said
That for employers and advisers seeking value for money schemes, today’s announcement is a big step in the right direction. The next challenge will be to improve understanding and awareness of master trust assurance and the benefits to both employers and employees, otherwise there’s a danger its value will be overlooked.
Darren Philp, director of policy at another master trust The People’s Pension, added:
The market has changed dramatically since auto-enrolment was being developed and there are now a number of players who are active in providing auto-enrolment solutions to smaller employers.
We encourage the regulator to build on this announcement to ensure that from here on in it continues to promote choice of assured schemes at every step of the process.
Petaurum Solutions’ Comment
Complying with complex Auto Enrolment obligations can be a daunting prospect for many small and micro-sized business. Choosing a cost effective, long-term implementation solution is critical for these businesses to ensure they do not become swamped with the processing requirements and responsibilities that Auto Enrolment can bring. Therefore, for businesses considering their solution, focus should not only be on the pension scheme, but also on how it will be administered, methods to communicate, impacts on systems and data collection processes along with any HR and Legal changes may you need to make.
Our Defaqto 5* quality Carey Master Trust Pension Scheme, comes with best in class assessment and communication software and is part of our SME specific, competitively priced end-to-end solution that will take care of the above, leaving you free to manage your business safe in the knowledge that your Auto Enrolment obligations are in professional hands. Want to know more? Then feel free to download our info pack here, or contact us to secure your PAE future.
This information is intended as a general overview and discussion of the subjects dealt with. The information provided here was accurate as of the day it was posted; however, the law may have changed since that date. This information is not intended to be, and should not be used as, a substitute for taking legal, HR or benefits advice in any specific situation. Petaurum Solutions is not responsible for any actions taken or not taken on the basis of this information. Please refer to the full terms and conditions on our website.