The Chartered Institute of Payroll Professionals
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Pensions
Automatic Enrolment
Use of TPR’s Automatic Enrolment enforcement powers back to pre - pandemic levels 14 September 2021
In The Pensions Regulator’s (TPR) latest compliance and enforcement bulletin, figures demonstrate that the overall use of its Automatic Enrolment (AE) enforcement powers are back to levels observed prior to the pandemic.
TPR has used this opportunity to warn employers not to neglect their AE responsibilities as the economy recovers.
The total use of AE powers between January and June 2021 increased to 77,032, in comparison to the figure of 41,398 for July to December 2020. In the six-month period (October 2019 to March 2020) prior to the pandemic, the total use of powers was 73,164.
From January to June 2021, TPR issued:
35,087 Compliance Notices
• • • •
11,921 Unpaid Contributions Notices 22,542 Fixed Penalty Notices 7,407 Escalating Penalty Notices
Over the duration of the pandemic, TPR ensured it closely monitored compliance and used its powers where necessary to ensure that employers met their obligations. It is important to note, however, that compliance with the law, including maintaining pensions contributions, remained high.
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NHS pension scheme changes – consultation 15 September 2021
The Department of Health and Social Care has opened a consultation to explore changes to the member contribution structure from April 2022.
As the scheme has moved away from being final salary linked to a career average revalued earnings (CARE) model, the consultation explores simplifying the contribution tiers to ‘flatten’ the model. Current tiers are weighted so that higher earners contribute proportionately more to access the benefits of the scheme. There are four main areas covered by the proposals: • Contributions are to be based on actual pensionable pay, rather than the current notional whole time equivalent pay (a system used to calculate a full time equivalent salary for part time workers). This will ensure part- time workers’ contributions are reflected more accurately and will see the amount they pay reduced. This change is proposed mainly due to the declining number of members with a final salary link • Using fewer contribution tiers as feedback from stakeholders has indicated a desire for this. The tiers proposed have been designed to retain the 9.8% average member contribution needed to protect the affordability of the scheme • Increasing the member contributions tiers with the annual pay awards under agenda for change. Under the current scheme annual salary increases, agreed centrally, can result in a member changing tiers and a net
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