The UK government has confirmed the starting date of the new automatic enrolment scheme in 2012. Yet for SMEs, because of the economic situation and to ease the effect of reforms during this Parliament, the starting date has been pushed back from April 2014 to May 2015.
Minister for Pensions Steve Webb said:
“Our society and economy needs to be based on a foundation of saving, not debt. Automatic enrolment will help millions save, and to not act will leave people poorer in retirement. That is why I am confirming today that automatic enrolment will start on time and all employers will be part of it.
“We recognise that small businesses are operating in tough economic times so we are softening the timetable for implementation to give them some additional breathing space. This is a sensible step that ensures long term pension issues are addressed while meeting the short and medium term needs of small business.
“We are committed to ensuring the employees of these small businesses get the chance to save and that is why no one will miss out.”
ABI comments :
Maggie Craig, Director of Life and Savings at the ABI comments :
“We have always strongly backed automatic enrolment as a good way to get people saving and our view on that remains unchanged. It is imperative that we help employees with no pension start saving as soon as we possibly can. We are pleased that the Government still plans to start automatically enrolling employees in 2012. We do realise that the UK is facing huge economic challenges and that small businesses are up against it. We support the Government’s efforts to alleviate some of this burden by allowing more time for the economy to recover before smaller companies start enrolling their employees into a pension.
“However it will be very important that this is not allowed to slip and slip. We need to keep up the momentum to address the UK’s savings crisis. We need a firm timetable so that employers are clear what is expected of them and the millions of workers in the UK without a pension can start saving for their retirement.”
Aviva comments :
Aviva’s Director of Workplace Savings Paul Goodwin said:
“We have always supported the staged rollout of auto-enrolment and felt that a staging date for most smaller employers of mid 2014 gave enough time to plan and budget for a suitable scheme. We felt the timetable was achievable and was overwhelmingly beneficial to the large number of employees who are currently not saving for retirement through any form of workplace scheme.
“However, we acknowledge that in today’s difficult financial climate a short delay may provide some employers with more flexibility to plan their auto-enrolment process.
“Providers, including NEST, and advisers need to continue to work closely with employers to minimise the cost of auto-enrolment and maintain the momentum behind these important reforms.”
