Why auto-enrolment must be our #1 priority
Talking Head: By the middle of 2018, more than 1.8m employers will have taken their business and their employees through the auto-enrolment process.
That represents more than 90 per cent of UK businesses, and 50 per cent of those have only one or two workers, which means we’re moving into a whole new world for pension saving.
Over the next two years, small and micro employers will need to either choose a pension scheme in which to enrol their staff members, or tell the Pensions Regulator they do not have any employees eligible to be enrolled.
But pensions are complicated and technical – even for professionals working in the industry.
Just as larger organisations did, small employers are likely to find the workloads and options overwhelming. But unlike larger schemes most will not have the benefit of existing pension schemes and in-house specialists – meaning most will have to start from scratch.
Unlike larger schemes most will not have the benefit of existing pension schemes and in-house specialists – meaning most will have to start from scratch
Many employers might not know where to turn, who to ask or who to trust.
Number one priority
Lesley Titcomb, chief executive at the regulator, told delegates at our recent annual conference that auto-enrolment is her number one priority. It needs to be a priority for all of us as well.
The National Association of Pension Funds’ rebrand to the Pensions and Lifetime Savings Association has been in response to the changes happening in how people now approach and fund retirement.
As the world changes, we too must change. We must help these new audiences save for their retirement – and 1.8m of small and micro employers are no exception.
To help these small firms the PLSA has launched an online product called Pension Solution designed to guide small employers through the process.
Small employers will get a step-by-step guide to auto-enrolment, templates for communicating with members, and a comparison tool of major scheme providers – much like the comparison tools people are familiar with seeing on consumer websites such as TripAdvisor or Which?
Our purpose is simple: to help everyone to achieve a better income in retirement.
If auto-enrolment is to continue to be the success it has been so far then we must offer this new tranche of employers the help and support they need, to provide their employees with a good workplace pension scheme and to help them save for retirement.
Graham Vidler is director of external affairs at the Pensions and Lifetime Savings Association