Auto-enrolment Delay

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Pensions Minister Steve Webb has confirmed that the Government is delaying pensions auto-enrolment for companies with 49 employees, or less.  The original staging date, as outlined in the Employers’ Duties (Implementation) Regulations 2010, was to commence in April 2014, with all employers eventually being live in the scheme from 01 September 2016.

However, the April 2014 start date has now been postponed until May 2015.  In a press release, the Minister reaffirmed the Government’s commitment to an economy built on the fundamentals of saving and confirmed that auto-enrolment would still commence, on schedule, in October 2012.  However, he recognised that economic conditions were such that some organisations were not in a position to be able to afford the contribution commitments, therefore, postponing the staging date for small employers ‘is a sensible step that ensures long term pension issues are addressed while meeting the short and medium term needs of small businesses’.  The press release says that further information will be provided in January 2012.

The staging dates will need to be changed through amendments to the above Regulations.  Also, the proposed employer minimum contribution increases will be delayed as a result.  This will be a benefit to all employers, not just small businesses.

The Pensions Regulator stated that employers and pension professionals should not regard this delay as an opportunity to put-off their preparations for auto-enrolment.  They are working with HMRC to ensure that all employers are aware of their auto-enrolment responsibilities under the Pensions Act 2008.  The link below is from HMRC’s Website but has links to The Pensions Regulator and the DWP.

Comment

The above postponement does seem to impact negatively on one of the main target groups of auto-enrolment – the employee working for the small employer without a pension provision.  We are all aware that the UK is not saving enough for its retirement; therefore, this postponement just seems to prolong the agony.

Further Information

• DWP  - Press Release 28 November 2011
• Pensions Regulator – Statement 28 November 2011
• HMRC  - Auto-enrolment – actions for employees and payroll administrators

Tags: automatic enrolment, DWP, HMRC, Pensions, Pensions Regulator, Steve Webb

This entry was posted on Friday, December 2nd, 2011 at 18:00 and is filed under Pensions. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.