28,000 businesses have been automatically enrolled in workplace pensions since the scheme began two years ago[i], but with the deadlines for businesses employing fewer than 50 now on the horizon, millions more must prepare now, warns national financial adviser Lighthouse Group.
Businesses with 49-30 employees must be ready for their automatic enrolment staging dates of between August-October 2015, while those with fewer than 30 employees will begin staging as early as June 2015 if selected by the regulator for the early staging trial run, or otherwise from November 2015 through to 2017.
However, The Pensions Regulator estimates that as many as 20 per cent of small employers and almost half of micro-employers are unaware of their staging dates[ii]. Many assume their staging date is based solely on their current number of employees rather than those recorded in April 2012 via their PAYE number.
The Regulator also found that 89 per cent of small businesses and 64 per cent of micro employers have sought or are planning to seek consultation with external advisers[iii]. With 99.2 per cent of the UK’s 4.9 million private sector businesses employing between 1-49 workers, those who have not yet planned will face stiff competition for advisers[iv].
Malcom Streatfield, CEO of Lighthouse Group, comments: “Although a staging deadline of next year may seem like plenty of time to prepare, the fact is that pensions enrolment takes a great deal of work. Employers must ensure all personnel data is correct and that their payroll system is capable, as well as choosing their pensions provider.
“All of this is a huge drain on resources for smaller employers, so it is little wonder then that so many are seeking help from advisers. However, those who have yet to take action will find themselves at the back of a long queue and, even with external help, time is running out quickly.
“While The Pensions Regulator has sent letters to all businesses with dates coming up in the next 18 months, many business owners will have filed them away and maybe forgotten about them. We urge all employers to check their pensions obligations immediately and begin preparations as soon possible.”
Staging dates can be determined by entering PAYE references into a tool provided by The Pensions Regulator here.
Lighthouse Group is the UK’s largest autonomous national firm of financial advisers and launched a pensions master trust specifically designed to help SMEs planning their pension roll-out to overcome the challenges of assessing and categorising workers, of adapting payroll systems and communicating the changes to staff.
The company has trained up over 200 local advisers to help SMEs with planning their preparation, including HR/payroll administration, handling the employer’s communication programme and scheme registration by submitting the declaration of compliance on time. Lighthouse’s Pensions Master Trust apps for advisers, employers and members are a ground-breaking development, helping promote member engagement, transparency and accessibility.
[i] http://www.thepensionsregulator.gov.uk/press/pn14-34.aspx
[ii] http://www.thepensionsregulator.gov.uk/press/pn14-33.aspx
[iii] http://www.thepensionsregulator.gov.uk/press/pn14-33.aspx