Pensions regulator to launch auto-enrol compliance tool

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The Pensions Regulator is to develop a tool to help around 200,000 small and micro employers comply with their automatic enrolment duties.

The regulator issued a consultation in March outlining plans to create software to support users of HMRC’s Basic PAYE Tools.

This was in response to concerns employers without adequate software support would not know how to assess which workers are eligible for auto-enrolment or calculate contributions, increasing the risk of non-compliance.

TPR says while employers who responded to the consultation backed the idea, the payroll sector was not in favour.

It says: “These respondents did not consider there to be a gap in the market and stated that their products could be used by BPT users either for free or minimal cost.

“A few professional advisers were also not supportive of a tool. Their reasons varied from being against what they perceived as Government intervention in the marketplace on principle, through to concern about the impact on their own business proposition.”

TPR says it plans to roll out the new tool by the end of 2015. The regulator says the functionality of the tool will be “limited” so it does not have a negative impact on the existing payroll and pension market. It says it will keep the need for the tool under review.

TPR executive director for automatic enrolment Charles Counsell said: “We will continue to recommend that BPT users consider using software with integrated automatic enrolment functionality, but by developing this basic contribution calculation tool we aim to ensure that BPT users have access to the help they need to support compliance.

“The decision to develop a basic tool is recognition that significant numbers of BPT users will not seek a more integrated solution and will attempt manual calculations. This is another example of how The Pensions Regulator seeks to develop new ways to ensure we are meeting the needs of the diverse group of employers due to stage in the coming years.”