FYLDE business leaders have warned small firms need to wake up over the Government’s new pensions regime.
Smaller companies will be made responsible for offering a pension to all workers with auto-enrolment on the scheme starting in 18 months time.
But a survey by the association for Consulting Actuaries warns fewer than one in five companies are even aware of this obligation. More than a million small and medium sized companies almost half the UK’s private sector workforce, will have to enrol their workers in a pension scheme such as the government’s National Employment Savings Trust between 2014 and 2017.
Hugh Evans, policy director at the West Lancashire Chamber of Commerce said it was a serious issue and companies should start looking at the issue as soon as they can.
He said: “Auto-enrolment will encourage individuals to prepare for their retirement and help the country to avoid a pensions time bomb. However, for employers it represents a significant new burden and the Government must do more to ensure that all firms are aware of these additional responsibilities.
“The Government and the Pensions Regulator must prioritise communication to employers of all sizes, particularly given the recently-launched advertising campaign directed at employees.
“Smaller firms, in particular, will need more support to minimise the time spent trying to adjust to this new regulation, and will want to feel prepared to answer their employees’ queries.”
Steve Pye from the Blackpool, Fylde and Wyre Federation of Small Businesses added: “There will be a huge cost to set up in terms of understanding the new auto-enrolment into pension schemes and how to implement them.
“All small businesses should contact their accountants, if they haven’t done so already, and see how it will affect them ASAP.
“They can then work with their accountant to ensure that they meet with their obligations and initiate the necessary financial planning required.”