The most profitable auto-enrolment business is being cherrypicked by pension providers, according to the vast majority of advisers.
Some 93 per cent of 244 advisers say providers will not take on employers that cannot meet employee contributions targets, according to a survey commissioned by auto-enrolment scheme Now: Pensions.
In July, Money Marketing revealed how providers had introduced strict rules around what new pensions business they would take on – including minimum contribution levels, minimum numbers of members and extra employer charges if those conditions are not met.
Nearly half of advisers also reported service delays as a result of growing pensions demand, with 56 per cent saying providers’ infrastructure is not as efficient as it should be.
Less than one in ten advisers were able to say providers have successfully managed demand for auto-enrolment services this year.
Now: Pensions chief executive Morten Nilsson says: “As we go into 2015, the problem of ‘cherry picking’ will worsen as fewer providers actively participate in auto-enrolment.
“But, we remain committed to accepting all employers regardless of size on equal terms.”