Affected documents are identified as 'UPDATED'. We have provided a breakdown of the earnings thresholds by pay reference period for the current and previous tax year.
The TPR plan to make further, more extensive updates to all the guidance in line with the outcome of the consultation on draft regulations and other proposed changes, currently scheduled for publication by the Department for Work and Pensions (DWP) in July 2013.
HOW DO YOU PLAN TO BEAT THE AUTO ENROLMENT CAPACITY CRUNCH?
8 May 2013
Many employers plan to rely on their current providers to provide them with Auto Enrolment solutions, however, these plans are been brought in to question due to predicted ‘capacity crunch’ facing the pension industry?
Thank you to Pensions Week for their report of this story
Many businesses intend to rely on their current pension or payroll provider to assist with auto-enrolment, according to our experience so far. But how much detailed analysis has gone into the feasibility of this approach is open to question. Why should employers think differently, especially if they have had a relationship with their current suppliers or administrators for some time? Sadly, current experience shows this reliance may not deliver the required or expected results.
It is now generally accepted that the UK pension industry will face capacity issues in delivering auto-enrolment.
Failing to engage with your current scheme suppliers and administrators from an early stage is a very risky scenario for employers. Being turned away by them when the time for delivery arrives and leaving no auto-enrolment option on the table creates additional costs, time and effort. Providers now look at the profitability of a potential scheme over the longer term much more closely than ever before. We have already seen evidence of many employers being turned away by their current scheme provider.
Many companies in this scenario may end up managing more than one scheme with more than one supplier or administrator, which creates significant additional work and costs.
Two or more schemes mean extra administration work as contributions are scheduled and paid to different sources. It begs the question: how will the employer's compliance with the reform's rules be monitored in this scenario? Does this mean the employer will need to use more than one software package to help with the ongoing assessment requirements and communications, potentially doubling up on both cost and effort? Also, many providers will not hold data relating to anything other than their own schemes. While this fact is understandable it does not help the employer, who is left with no option but to cope with a multi-scheme scenario and all the additional in-house administration that will be required. This scenario highlights just one reason why employers could consider using standalone third-party software. It is also one of the reasons why the industry is seeing a resurgence of mastertrusts, which allow the employer to take more control of not only the structure, design and employee communications but also the scheme default investment strategy.
CIPP Policy News Journal
16/04/2014, Page 377 of 519
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