Awareness up but early planning essential to keep down auto enrolment pension costs
Despite increased awareness of their auto enrolment staging dates, many firms continue to underestimate the time needed to ensure they have suitable provision in place, according to the latest research by national business group the Forum of Private Business.
The findings from its latest member survey into the cost of compliance reveal that, while an resounding 90% were aware of deadlines for them to have schemes in place, over half (51%) have still to start taking any of the necessary steps required to be ready for auto enrolment.
While the figures presented a more positive picture compared with the most recent Employer’s Pension Provision Survey from the Department of Work and Pensions, they highlight the pressing need for small business owners to understand the importance of starting the auto enrolment planning process sooner rather than later.
Commenting on the results, Ian Cass, head of business support at the forum said:
“The findings show that our members are ahead of the game when it comes to auto enrolment. It is great news that the overwhelming majority are aware of their staging dates and obligations thanks to high profile awareness campaigns and regular member updates. However, awareness and action are two separate things. The question of whether small firms will be able to have their schemes up and running in time and at a reasonable cost remains a serious concern.
“Questions over the ability of providers to cope with the high demand for pensions advice, and their willingness to offer products to the SME market are a growing worry as we get ever closer to auto enrolment deadlines. What is becoming all too apparent is that companies who fail to plan sooner rather than later could find themselves paying a premium for advice and more limited options. With average costs for auto enrolment currently estimated at £8,900, these are only likely to go up the closer we are to those all important staging dates.”
