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Two thirds of small firms unaware of auto-enrol dates

Charles Counsell 700 x 450

Hundreds of thousands of Britain’s smallest employers do not know when they need to begin paying pension contributions as part of auto-enrolment.

A survey of employers’ awareness of the reforms, commissioned by The Pensions Regulator, shows only 38 per cent of small and micro employers have an accurate knowledge of their staging date.

Around 1.8 million employers will need to comply with auto-enrolment duties over the next two years.

The research also suggests that while there is a high level of awareness of the concept of auto-enrolment, knowledge of the details is more patchy.

Only 72 per cent of micro-employers know they will need to communicate to workers on an individual basis and just 59 per cent are aware they need to complete a declaration of compliance.

Small and micro-employers are most likely to use or plan to use accountants for help with auto-enrolment, at 31 per cent and 38 per cent, respectively.

But 20 per cent of small and 15 per cent of micro-employers use or expect to use a financial adviser.

TPR executive director of auto-enrolment Charles Counsell says: “The challenge of ensuring 1.8 million employers meet their duties by April 2017 is significant and the research shows many employers are still not preparing early enough.”

He adds: “It is also positive that more advisers have stepped up to meet the needs of employers by developing new services, and by directing clients to the regulator’s website. I urge all intermediaries to ensure they can fulfil this vital role as more employers seek assistance.”

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. I’m getting a bit fed up saying this and I’m sure many a fed up hearing it. I have been saying this for ages. It is no surprise. Micro firms have better things to do that become an ex officio government benefit agency. What is the regulator going to do? Make hundreds of firms bankrupt and put hundreds more on the dole? Great idea.

    The best things for these firms is to remain calm and keep together. If the worst happens they can either liquidate, make the employees self-employed if necessary or just close. The Regulator (and the Government) won’t want to be seen closing hundreds of small entrepreneurial firms and eventually sense will prevail and they will allow micro firms to opt out.

  2. The challenge facing small businesses – including the micro micros who don’t see themselves as businesses or even employers- is no different than from RTI – or VAT – or PAYE.

    There is so much you can put on business before there is mass revolt and i don’t get the impression we are at the mass revolt stage.

    The IOD claimed that such a revolt would happen last year- it didn’t happen. Let’s hope that AE II proves as successful as AE I, to a large extent- this is in the hands of the readers of Money Marketing and I hope they will do everything they can to engage, educate and empower employers to do AE right.

    Join Friends of Auto-Enrolment and get stuck in.

  3. I read this article with interest especially with regard to intermediaries.

    We are intermediaries and have been active in the AE arena for some 18 months. We offer employers the full end to end AE service including independent pensions advice and also a number of free services which include:
    AE helpline
    Emailed information on AE with links to TPR
    Friends of AE quarterly seminars and presentations in association with the CIPP, in fact we have one at a venue in Kent in October where a representative of TPR will be in attendance.

    So help is out there, the challenge we face is getting the message across.

    I agree with Henry’s comment, we should do everything we can to educate and empower employers to do AE right and like ourselves there are many advisors working hard to ensure that this is done. However, this depends on one crucial message to employers for this to happen, Engage Early. We know from the pension providers and the industry that many employers are leaving it too late to be empowered to make the right choice of provider and strategy for their business. Maybe TPR should send this message out a little more loudly and clearly to empower intermediaries and employers alike.

    So we are out here to help and advise but, as this article hints at, not nearly enough of us to handle the stampede to come.

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