Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Moody's - Climate Risk Insurers series
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • October 2014
10

Small firms would like auto-enrolment delay, ACA poll finds

Open-access content Thursday 23rd October 2014 — updated 5.13pm, Wednesday 29th April 2020

Over 90% of small employers – those with 249 or fewer workers – want to delay their in auto-enrolment duties until ongoing pension reforms are completed, an Association of Consulting Actuaries poll has found.

In a survey of 414 smaller firms, the ACA found that 62% of employers with ten or more employees are now clear about when they must auto-enrol eligible employees into a defined contribution pension scheme. However, among employers with very small workforces - nine people or fewer - less than half (46%) had identified their staging date.

ACA chair David Fairs said he was not surprised at the number of smaller firms that wanted to setback their staging date, due to the many pension reforms being squeezed into a short time-frame.

Currently, three-quarters of firms with four or fewer employees offer no pension scheme, but would be required to auto-enrol their employees into a defined contribution pension scheme over the period 2014 to 2017, with a minimum of 1% from the employer plus 1% from the employee, noted the firms ACA 2014 smaller firms' pension survey.

And by October 2018 these contributions must be the equivalent of 8% of employee 'band earnings', with a minimum of 3% from the employer plus 4% from the employee.

Fairs said this added a lot of pressure on smaller firms 'at a time when average pay increases are likely to be well below these figures'.

'In a three year period from the middle of this year, over one million small employers will have to meet the auto-enrolment challenge,' he said.

'Yes, it is right that pension provision should be available to employees in even the smallest firms, but with so many pension reforms being squeezed into a short time-frame, it cannot be surprising that smaller employers are calling for a delay in auto-enrolment.

'We believe that there could be some sense in pausing the dates when employers with fewer than 50 employees are due to auto-enrol - namely those due to auto-enrol from June 1 2015 onwards.'

He said this would give all of the political parties the opportunity in the run-up to the General Election to outline what financial measurers they are proposing so the scheduled higher minimum pension contributions from October 2018 do not undermine take-up or, employment levels.

Elsewhere the survey found that almost two-thirds (60%) of smaller firms are supportive of the budget reforms, with just one in ten opposed.

Also, 'face-to-face' meetings are seen as the most popular channel for the ‘guidance guarantee’ by employers, followed by web-based tools and then telephone guidance.

And over half (56%) of employers said they supported further changes that targeted current levels of pension tax on those with lower incomes, with a third saying that reliefs should be further restricted for those on higher incomes. 

This article appeared in our October 2014 issue of The Actuary.
Click here to view this issue
Filed in
10
Topics
Pensions

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Risk Actuary - General Insurance

London (Greater)
£60,000 - £85,000
Reference
145934

Project Actuary - Life Insurance

Midlands
£60,000 - £110,000
Reference
145933

Model Validation Actuary

London (Greater)
£60k - £80k
Reference
145932
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2023 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ