pensions/LEP 13 Auto-enrolment: the
implications of deferring matters The Government introduced legislation in 2012 requiring all employers to establish an auto-enrolment compliant pension scheme and where appropriate make pension contributions for all eligible employees, writes Jason Mitchell of MHA MacIntyre Hudson
During 2012/13 larger employers have been taking action to ensure that they meet the new pension rules. Based upon the figures to date, pension providers have been able to handle the numbers of applications. However, over the next 18 months the vast majority of employers will need to have either verified that any existing arrangement meets the new auto-enrolment criteria or have established a new scheme. The issue may not be simply an employer’s willingness to embrace the new legislation but an industry capacity issue: one of finding a pension provider who is willing and capable of accepting an employer’s application for a new scheme.
According to research by the Centre for Economics and Business Research (Cebr), auto-enrolment will cost small-to-medium-sized businesses
with up to 100 employees £12,600. Firms with up to 250 staff will face a bill of £15,600, while those with 500 people could spend as much as £23,300 to be ready for the new legislation. Traditionally, setting up a pension scheme for an employer was relatively easy, but integrating the auto-enrolment rules and regulations in an employer’s business is more difficult and needs a considerable amount of time and resource.
As a result many providers are setting out strict lead in times. Many of the primary pension scheme providers are also not willing to accept a scheme application if they are within six months of their staging date and some have also set minimum contribution levels to ‘cherry pick’ profitable business. It is therefore strongly recommended that employers should start considering
the issues associated with auto- enrolment at least 18 months in advance of their staging date.
Employers who do not start early will be faced with a number of issues:
• A decreasing range of suppliers as time runs out and demand for schemes increases.
• The need to use a pension provider that may not provide the solution that best fits their business.
• Increased demand will have an effect on the level of advice fees charged.
• The Pension Regulator has the power to implement financial penalties of up to £2,500 per day where non-compliance is an issue.
Employers who do not take into Thames Valley Berkshire Local Enterprise Partnership
Is looking for business leaders to join its executive board and strategic transport body
Thames Valley Berkshire Local Enterprise Partnership (LEP) is a business-led organisation charged with driving sustainable economic growth in Berkshire. Our executive board members are highly influential individuals representing businesses, education, local government and the community sector.
We are in the throes of an exciting journey: we have recently agreed an historic Growth Deal with the Government, which will see £96.9 million invested in Thames Valley Berkshire (TVB). Projects delivered will include infrastructure, skills and enterprise to ensure that TVB
DIRECTOR ON THE LEP EXECUTIVE BOARD (volunteer)
This voluntary role will be as a director on the LEP Executive Board representing SMEs and will be for a minimum of three years (maximum of five years). The executive board meets every month and additional input outside of these meetings is expected.
If you would like to discuss this position informally please contact Steve Lamb the private sector chairman of TVB LEP, at:
stephen.lamb@
oracle.com or on 07768-258314.
retains its position as one the most successful economies in the UK.
We are now seeking a private sector director to join our executive board and business representatives to join our Strategic Transport Forum. With a successful track record in Berkshire you will bring your business skills,
experience and strategic nous to help us deliver our plan for growth.
If you have an active and current role in a business in Berkshire and want to make a difference to the wider TVB economy we would like to hear from you. We currently have the following vacancies:
MEMBER OF THE BERKSHIRE STRATEGIC TRANSPORT FORUM (volunteer)
We are seeking six business people to sit on our Strategic Transport Forum alongside councillors from Berkshire’s six unitary authorities. Applicants will bring their expertise to strategic transport issues across Thames Valley Berkshire. The Berkshire Strategic Transport Forum (BSTF) meets at least three times per year.
If you would like to discuss this position informally please contact Richard Tyndall of TVB LEP, at:
richard.tyndall@thamesvalleyberkshire.co.uk or on 07880 -787007.
If you wish to apply for either of these positions, please send your CV/Profile and a one-page summary of your reasons for wanting to join us, to
joanna.birrell@
thamesvalleyberkshire.co.uk by 9am Monday September 22, 2014. It is anticipated that interviews will take place w/c September 29, 2014.
If you have general questions about the LEP please contact Tim Smith, business director TVB LEP. Tim Smith can be contacted at:
tim@thamesvalleyberkshire.co.uk or on 07500-870172.
Registered address: 100 Longwater Avenue, Reading, Berkshire RG2 6GP –
www.thamesvalleyberkshire.co.uk – 0118-9450200 –
info@thamesvalleyberkshire.co.uk A company limited by guarantee and registered at Companies House No. 07885051
THE BUSINESS MAGAZINE – THAMES VALLEY – SEPTEMBER 2014
www.businessmag.co.uk
consideration the pension industry’s potential inability to process an employer’s application, with less than six months to their staging date, may either need to apply and operate a scheme via the Government sponsored National Employment Savings Trust (NEST) or face a financial penalty.
It is crucial to take advice and start planning early.
Details: Jason Mitchell 0118-9503895
www.macintyrehudson.co.uk
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