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Creative Auto Enrolment links with ScotWids on new compliance offering

Employee benefits firm Creative Auto Enrolment has launched an end-to-end online auto-enrolment service that promises to cut preparation time down to just 103 seconds.

The product is aimed at SMEs, typically with 30 members or less, and cuts out the need for middleware to handle data between employers, providers and payroll.

Employees will be enrolled in a new master trust run by Creative, using Scottish Widows’ investment platform and Pan Governance as the professional trustee.

Creative Auto Enrolment managing director David White says: “This will revolutionise the way auto-enrolment is carried out. Our research found it takes 103 man days to comply with auto-enrolment, we believe we’ve got that down to a sign up that takes 103 seconds.”

White says the service will allow employers to automatically populate the declaration of compliance – the biggest reason for employers falling foul of The Pensions Regulator, according to the firm. The system also runs assessment and communication compliance straight into the master trust.

He says: “This is a major step forward. The industry has had problems in moving data around between clients and providers and middleware systems. They do not have to do that with this system – they can go back to running their payroll like they used to, running their pension scheme without having to do any auto-enrolment compliance themselves.”

Employers are not charged to use the system. There is a 0.4 per cent management charge plus £2 a month per member. However, members earning less than £18,000 will pay 60p a month until 2018 when minimum contributions for auto-enrolment rise.

White says the overall charge for the offering is 0.67 per cent – well below the auto-enrolment charge cap of 0.75 per cent due to come into force in April.

Scottish Widows head of industry development Pete Glancy says: “We’ve always had a concern that there won’t be enough choice, capacity or competition at the smaller end of the market. We’re very keen that small employers have the same opportunities as bigger employers. While we tend to specialise with larger employers, we’re keen to support the smaller end of the market.”

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Comments

There are 7 comments at the moment, we would love to hear your opinion too.

  1. So employers are not charged anything for using the system and employees earning under £18,000 per annum are charged 0.67% AMC plus 60p per month (£7.20) per annum. Surely this is above the cap of 0.75% for all member deductions if the employer chooses to phase in contributions using QE minimums? Maybe I’m missing something…

  2. Its 0.4% PA AMC plus the member costs Gavin.

  3. White says the overall charge for the offering is 0.67 per cent – well below the auto-enrolment charge cap of 0.75 per cent due to come into force in April.

    Even excluding the 0.4% AMC, assuming an employee earns £12,000 pa and contributes AE minimums (1%+1% = £240) then a 60p per month charge equates to more than 0.75%

    I’m genuinely confused.

  4. Hi Gavin

    Thanks for your comments. The government has set out the permitted charging structures for qualifying schemes in some detail in the command paper ‘Better workplace pensions: Tackling unfair charges – a cap on charges’. This is due to be passed into law in April and the paper is very clear that these structures must be used. Table 3.2 on page 64 sets out the mandated equivalency for our flat fee/FUM charge structure. The main point I hope you and other Money Marketing readers will take away is that we have worked very hard to deliver the most comprehensive, end-to-end auto enrolment solution on the market, with excellent benefits for scheme members, employers and their advisers, and we have done so well within the charge cap.

    Regards

    David White
    Managing Director, Creative Auto Enrolment

  5. Hi Gavin

    Thanks for your comments and also thanks to John Davenport for clearing up the misunderstanding about how our charge is structured. The government has set out the permitted charging structures for qualifying schemes in some detail in the command paper ‘Better workplace pensions: Tackling unfair charges – a cap on charges’. This is due to be passed into law in April and the paper is very clear that these structures must be used. Table 3.2 on page 64 sets out the mandated equivalency for our flat fee/FUM charge structure. The main point I hope you and other Money Marketing readers will take away is that we have worked very hard to deliver the most comprehensive, end-to-end auto enrolment solution on the market, with excellent benefits for scheme members, employers and their advisers, and we have done so well within the charge cap.

    Regards

    David White
    Managing Director, Creative Auto Enrolment

  6. Both NEST and NOW:Pensions operate charges in this way that make them more than 0.75%.

  7. As David White points out, CAE have cuts costs and time in the process by cutting out middleware. CTC Sotware is pleased to be the technology that supports this. We see the age of ‘middleware’ is over to be replaced by ‘endware’.

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