Defined Benefit (DB) elements to defer Automatic Enrolment (AE) under rules only meant to apply to those with open DB options. However, the DWP said it will amend the Pensions Act 2008 to remove the loophole and a written ministerial statement was presented to Parliament. Amendments will have a retrospective effect. It also said firms who have issued a notice to employees about deferring AE while only offering a DC scheme will have to backdate contributions. The allowance to defer until 2017 was originally brought in as the funding requirements meant employers offering DB could not take advantage of phasing in contributions, as can be done by those offering Defined Contribution. The department said: "The government is acting to put beyond doubt its intention that people with access solely to a DC pension do not have their auto-enrolment deferred, even if they are in a hybrid scheme. "An amendment to the Pensions Act 2008 will tighten the rules, ensuring that only employers offering DB to a jobholder - whether in a DB or hybrid scheme - will be able to defer auto- enrolment until 2017. Under the change, all eligible jobholders who do not have access to DB must be auto- enrolled from their staging date." Pensions minister Steve Webb said: "It's vital that firms comply with the spirit as well as the letter of the law. I'm sending out a clear message that all workers should be allowed to save for their retirement as soon as possible."
The loophole was originally spotted by LCP , which called on the government to clarify the rules.
TPR RELAUNCH STAGING DATE TOOL
31 January 2013
The Department for Work and Pensions has launched the next phase of its media campaign which is urging employers to act now to develop a plan for automatic enrolment.
As part of this activity they have re-launched their staging date tool . Most employers will now be able to enter their PAYE scheme reference into the tool to establish their staging date, based on the HMRC information held by the regulator 1 April 2012.
FURTHER CONSULTATION DUE ON AUTO ENROLMENT CHANGES
11 February 2013
The Department for Work & Pensions (DWP) have published news that a consultation will be launched next month on proposed simplifications to Auto Enrolment.
The five year roll out of Auto Enrolment began in October 2012 and based on early feedback a shortlist of areas, which it is reported could benefit from practical or technical improvements, has been drawn up. The list includes: Making workforce assessment easier. Making it easier for Money Purchase schemes to demonstrate that they meet scheme quality requirements. Removing the duty to enrol particular groups such as those who benefit from protection because they have already exceeded the lifetime allowance for tax purposes Minister for Pensions Steve Webb said:
CIPP Policy News Journal
12/04/2013, Page 255 of 362
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