The Government’s response to the consultation on draft regulations to further simplify the automatic enrolment process has been published. The Regulations that bring certain changes into force from 1 April 2015 have also been laid in Parliament and published.
Technical Changes to Automatic Enrolment - Government response to the consultation on draft regulations
Since the original framework was laid down in Pensions Act 2008 and the Occupational and Personal Pensions Schemes (Automatic Enrolment) Regulations 2010, there have been changes to the legislation to make automatic enrolment easier to operate. More recently, following a consultation on technical changes to automatic enrolment, run in early 2013, measures were included in the Pensions Act 2014, which are intended to further simplify automatic enrolment and reduce burdens on employers. These measures are designed to:
• Introduce an alternative quality requirement for DB schemes • Simplify the information requirements on employers • Create exceptions to the employer duty in certain circumstances
From 1 December 2014 to 9 January 2015 the Department for Work & Pensions (DWP) consulted on draft regulations which set out the detail of these measures. In particular they sought views on whether the draft regulations achieve the overarching policy intent of simplifying the process for employers. The DWP also wanted to ensure that those who will benefit most from pension saving continue to be automatically enrolled and that there are no unintended consequences for individual savers.
Responses were broadly supportive of the aims of the regulations with most respondents agreeing that they would reduce burdens on employers.
The Occupational and Personal Pension Schemes (Automatic Enrolment) (Amendment) Regulations 2015 make the following changes as detailed in the explanatory note:
• These Regulations amend the Occupational and Personal Pension Schemes (Automatic Enrolment) Regulations 2010, by reducing the information requirements on employers, introducing certain circumstances where the employer duty is turned into a discretion and also prescribing alternative quality requirements for defined benefits schemes. • Regulation 5 makes provision under section 87A of the Pensions Act 2008 introducing further exceptions to the employer duties contained in that Act. Where those exceptions apply, the relevant sections of the Act are modified. • Where notice of termination of employment has been given, the employer duty to automatically enrol or re-enrol is turned into a discretion and the entitlement of a jobholder or worker to opt in to or join a scheme does not apply. Where it is agreed between the worker and employer that notice is withdrawn, the duties are imposed from the date of that agreement. • The employer duty to automatically enrol or re-enrol a worker or jobholder is also turned into a discretion where a worker or jobholder has decided, in the last 12 months, to leave a qualifying scheme; where a jobholder benefits from certain tax protection; and where a worker has received a winding-up lump sum in the last 12 months. Regulation 5 also provides that where the employer exercises the power to make arrangements for the jobholder or worker to join a relevant scheme, the employer is to be treated as if they were discharging a duty.
CIPP Policy News Journal
08/04/2015, Page 363 of 521
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