Auto Enrolment and the DC Pension Debate

We have heard a number of our prospective customers ask “after 2012 will I be better off using a scheme such as NEST or to extend my existing GPP/Trust Based Money Purchase scheme for all of my employees?”

We consider that the first issue is not one of which product you use but how you manage compliance with the auto enrolment regime!

Every eligible employee in the UK will be auto-enrolled into a meaningful workplace pension scheme by (at the latest) September 2016.Each employers staging date is dictated by the number of employees they have. Please see across for a calculator which tells you when yours might be.

Each employer will eventually need to make pension contributions of at least 3% for every one of these employees who take up their scheme, regardless of the scheme type.
Where this level of contribution can be alarming for some businesses it can be phased in over time and minimised with careful tax planning. The immediate, but less obvious problem will be managing auto-enrolment administration and all that comes with it.

This, we believe will be the hidden cost of the new Pensions Act.

Lansdown Place Corporate Benefits offers specialist Independent Financial Advice in this area. We can help you plan and manage your obligations, providing all the expertise, guidance and technology to make sure you comply with the new regulations. Whether that be through your existing pension provider or a separate software system selected from across the market.

All existing workplace pension schemes need to be assessed to ensure they are of a specified minimum quality by each employer’s respective implementation date.

All employers without a qualifying workplace pension scheme need to set up and register one by their respective staging date It is estimated that nearly 750,000 employers will need to do this before the end of 2016.

Lansdown Place Corporate Benefits have specific systems and advice to help employers manage their auto-enrolment obligations along with many other employee benefits areas. We can work with existing or new “qualifying workplace pension schemes” and establish a strategy for compliance ready for a company’s implementation date.

In light of the changes proposed by the Pensions Act 2011 the questions we would ask each business right now are, how you will manage:-

• To administer the pension in line with legislation:
• To produce a report to calculate minimum pension contributions
• To establish who are your: eligible jobholders, non- eligible jobholders and entitled workers in your workforce at each pay period.
• To facilitate communication between employee, employer and pension scheme to manage opt in/opt out processes
• To facilitate the collection and reconciliation of auto-enrolment contributions

Some of the key features of our systems include:-

• Managing pension Auto-Enrolment
• Publish and maintain scheme and HR data
• Desktop message alerts to all staff
• Email alerts and workflow management
• Streamlined joining with product providers
• Financial modelling tools
• Management information on-demand
• Data upload and download with Excel
• Real-time integration with XML messaging
• 24/7 information on-demand
• .NET technology

This will mean:-

• Compliance with Employer Duties of PA2011 under auto enrolment

It is then, and only then, that we can begin the debate with you about which product your employees should be auto enrolled into!