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Advisers back Govt auto-enrolment simplification plans

Steve Webb 480 NAPF 2012

Advisers and pension providers have backed Government plans to simplify automatic enrolment for small and medium-sized employers next year.

Auto-enrolment began for the UK’s largest employers in October. The reforms are being phased in, with SMEs required to comply with the new rules by 2018.

The Department for Work and Pensions will undertake a significant auto-enrolment simplification programme in 2014 in an effort to make the reforms less burdensome for smaller companies.

Speaking at the launch of the ‘Nest Insight’ report last week, pensions minister Steve Webb said: “A lot of the [problems] doing automatic enrolment were always going to be found out when we actually did it.

“So we will practice on the big employers, learn our lessons, and then do a round of simplification so when we get to the small and medium-sized firms those irritating regulations that do not need to be there or are not very clear can be ironed out.

“Doing that all in one go in a year or so feels like the right way to do it. So if providers or employers come across things about the way auto-enrolment is being done that are causing problems, we are very keen to streamline that process.”

Hargreaves Lansdown head of pensions research Tom McPhail says: “There were always going to be practical issues which only came to the fore once employers actually started doing this.

“Reviewing and simplifying the rules in one go, rather than trying to ‘whack a mole’ every time a problem comes up, seems to me like a sensible and pragmatic approach.”

Now:Pensions chief executive Morten Nilsson says: “Auto-enrolment is incredibly complicated so anything which simplifies the process, particularly for small employers, is a good thing.”

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