Pensions minister Steve Webb has confirmed the Government will delay automatic enrolment for small employers until after 2015.
In a statement to the House of Commons, Webb (pictured) also indicated that any employer expecting to auto-enrol their staff after July 2013 could see their staging date pushed back. This would include firms with up to 3,000 employees.
Details of the revised schedule will be published early next year. Under the new timetable, companies employing up to 50 workers will not have to auto-enrol staff until after the next Parliament.
Webb said: “We will be going ahead with auto-enrolment as planned and I can confirm all businesses remain in scope.
“We have however decided to extend the current five year implementation period so that small businesses will not have to start enrolling their workers until the start of the next parliament. Never the less these revised plans will still result in more than half of all workers enrolled before the end of this parliament.
“Everybody who is due to be enrolled this side of July 2013 will see no change in their dates. We will publish a revised schedule early in the new year.”
Legal & General pensions strategy director Adrian Boulding, who was part of the three man ‘Making automatic enrolment work’ review commissioned by the DWP last year, says the delay is a “huge mistake”.
He says: “Demographically this is completely the wrong thing for the Government to be doing.
“The point of getting people to save for their retirement is that the baby boom generation are still in work, so this is their opportunity to save for retirement.
“If we delay, defer or miss this opportunity then the costs for providing pensions for that big generation are being landed on the much smaller generations following them. It is a huge mistake.”
After days of media coverage of possible changes to auto-enrolment, Shadow pensions minister Gregg McClymont attacked the changes as a “policy made in the press” and called for the Government to deliver a full ministerial statement on the changes. Commons speaker John Bercow said it was a matter for the Government.
McClymont said: “On policies made in the press, in particular the case of auto-enrolment, the Secretary of State for Work and Pensions, before he left the dispatch box said yes policy should be made in the house. Would a written ministerial statement on the changes made to the auto-enrolment be in order?”
Bercow said: “The decision as to whether a policy announcement should be the subject of a written or oral ministerial statement is always and without exception a decision for the minister.”