What does the Future of Employee Benefits Look Like?

As you will all be aware, this year we have seen a reduction in the Lifetime Allowance (LTA): the amount of tax-free savings an individual can have in their pension fund upon retirement has been reduced from £1.25 million, for the tax year 2015/16, to £1 million, for the year 2016/17.[1] Any pension fund exceeding the £1 million LTA will be taxed at a rate of 55% on anything taken as a lump sum and at 25% if the excess is taken as an income (such as a scheme pension or annuity).[2]

Consequently, it would be fair to imagine that we will see a wider range of workplace saving solutions being offered as employees shy away from the potential expense of saving into a pension fund, instead seeking alternative means of saving. Investment is bound to be seen as a popular alternative. Employees will want to be educated on the subject of investment and employers may well have to provide that education.

It is impossible to discuss the future of workplace benefit schemes without highlighting the role of technology. The recent boom in wearable technology signals the end of one-size-fits-all benefit schemes. Increasingly we have seen attention being focussed on work/life balance; the truthful notion that happy, healthy workers are more productive has become quite ubiquitous. For some time now employees have been encouraged to monitor their health via healthcare apps on mobile devices. And whilst digital medicine is entering the mainstream – via smartphone apps, smartwatches and smartshirts – the UK’s population is ageing, as is its workforce. Employers will feel the need to monitor the individual health of their ageing workforce and will be able to do so, thanks to advanced wearables.

Employee benefit packages will also be centred on individual health. Specifically designed healthcare apps will become ever more prevalent: employers will be able to use these apps to monitor employee activity levels, blood sugar levels, and so on, as well as to communicate benefit packages to employees.

Employees and potential employees will seek jobs that offer health-centric benefit packages. And as wearables become increasingly popular, health packages will need to reflect that. Packages will need to be far more personalised and built upon each individual’s personal health data. Employers will be able to gather real-time data from their employees, allowing them to monitor their activity levels, their blood sugar levels and so on. This will enable employers to derive a real sense of the wellbeing of their employees and conversely, the causes of poor health.

It is important that benefit packages can be communicated to employees individually and at all times. In the UK, the number of smartphone users is set to rise to 46 million by 2018.[3] Employees will want to access their benefit platforms at all times, no matter their location. Consequently, benefit platforms will have to become increasingly accessible, self-serviceable and interactive. Information is increasingly being presented in a variety of formats: I would imagine that we will see more video content being used to explain how different benefit platforms should be used and how to access benefits.

The future of employee benefits is one that is tied to technology. As technology becomes ever more personalised, it will be possible for benefit schemes to be similarly personalised. Overall we will see schemes tailored to the individual employee. Employers will benefit too, from a workforce that is happy, healthy and taken care of. As long as benefit platforms are able to keep up with employee/employer demands for efficiency and accessibility, the future of benefits will indeed be bright.

Mark Howlett
Chief Executive

---

[1] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[2] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[3] http://www.telegraph.co.uk/technology/mobile-phones/11287659/Quarter-of-the-world-will-be-using-smartphones-in-2016.html

What is success?

The Government announced yesterday that 60,000 people used the pension freedoms and £1bn was paid from pension schemes to individuals since the freedoms were launched in April 2015. This is being hailed as a success by the Government, but is it?

This is an average pot size of c£17,000 being paid out. Of course it is likely there’ll be a range of payments across a bell curve of sizes but it is clear that this is something that will have impact on the smaller pot sizes. What could someone have done with a pot of £17,000 before April? Not a lot. Buying an annuity would have been the only option and a paltry income of around £560 pa would have been provided. So on the face of it those people may have benefitted from the changes, provided they use the money wisely now.

Some of these people may end up on state benefits, or be on state benefits. Taking benefits in a flexible way can result in the state acting as if you still have it or that you used it to buy an annuity. The upshot being that short-term spending of the fund could result a long term impact on the state benefits they could have been entitled too.

It is possible these “early adopters” were the many individuals delaying buying an annuity in anticipation of the changes and so while £1bn may seem a lot it was around the normal amount paid over a similar period to buy an annuity when that was the main option.

We don’t know what the tax take on this was, but when the Government talk about success it is surely with one eye on some more money into the coffers in income tax. It is also slightly different in the annuity days when £1bn would have remained locked away this has been released to spend. It would be interesting to see the impact on over 55s spending habits. What have they been doing with this money?

We also don’t know the ages of the people accessing these funds. Is it possible these are younger than the 65 year olds that access their funds. This early use of pension benefits, albeit small now, could have longer term ramification on those that in ten to fifteen years realise their pension funds are now too small to retire on as they used it to early.

So success or not? Success is a funny word to use when we only know the number of people and the number of pensions paid in total. Especially when the amounts mirror the pre freedoms world. People retire and need money to live on all the time. I accept it is politics but by any measure success surely cannot be determined yet. Have these people made use of Pension Wise? Have those that didn’t taken independent financial advice? Have they taken a wise decision? If yes, success. Have these people blown their nest egg too soon? Have they racked up a big tax bill? Have they inadvertently triggered the MPAA to their detriment? If yes, not successful I would say. Sadly, we may never know these answers before it is too late.

David Brooks

Technical Director

Telephone: +44 (0)20 7893 2262 

Email: david.brooks [@] broadstone.co.uk

The Lifetime Allowance: How Low is Too Low?

In March, the Lifetime Allowance (LTA) was cut once again by Chancellor George Osbourne. He has also claimed that by 2018 the LTA will be indexed-linked, adjusting with inflation.[1] The amount of tax-free savings an individual can have in their pension fund upon retirement has been reduced from £1.25 million, for the tax year 2015/16, to £1 million, for the year 2016/17.[2] Any pension savings exceeding the £1 million LTA will be taxed at a rate of 55% on anything taken as a lump sum and at 25% if the excess is taken as an income (such as a scheme pension or annuity).[3]

Given the pressure that Osborne is under to reduce the deficit, it is perhaps reasonable that he would choose to cut the LTA; after all, the cut will save the Treasury around £600 million a year.[4] And there is good reason for the existence of LTA. The Government uses the promise of tax-free pension savings to incentivise the UK to save money for retirement – once no longer earning, they will not be dependent on the state. And, arguably, there can be little point in offering tax relief to pensioners beyond the level required for fairly basic living. This would be a luxury the state cannot afford; more relief simply means greater deficit.

When commenting on the recent cut, Osborne said that the limit for the LTA is so high that, “Fewer than 4% of pension savers currently approaching retirement will be affected”.[5] However, whilst that maybe true for soon-to-be pensioners, the rest of the UK may be less fortunate. As the Pension Advisory Service rightly points out, pensions are a long-term commitment and what may seem a modest accumulation of savings to start with may exceed the LTA by the time benefits are drawn.[6] Furthermore, the LTA applies to total pension savings - anyone who has had more than one job, and consequently more than one pension scheme, should keep this in mind.

The LTA cut will disproportionately affect those with a defined contribution (DC) pension scheme compared to those with a defined benefit (DB) scheme. Typically, those working in the public sector will have a DB scheme; this type of scheme is far easier to monitor, meaning you can stop contributing to or draw from your pension scheme before you hit the LTA limit. However, if you work in the private sector, you are likely to have a DC scheme. Should the investments made by your pension provider be successful and you pension exceeds £1 million, you could be penalised with a 55% tax rate. Although one can monitor how much is contributed to a DC scheme, it is impossible to know how much that pension will ultimately be worth. Thus, the investor pays the cost of poorly performing investments but risks just as much with investments that are successful. £1 million may seem like a vast amount of money but is reasonably easy to achieve. So, the LTA may affect a far higher percentage of the population than just the very richest amongst us.

It is possible that even the most modest savers could hit the LTA if their investments perform well over their lifetime. Consequently many savers will be discouraged from saving, which would risk them being dependant on the state for part or all of their retirement (the problem being further compounded by an ageing population). The £1 million LTA seems low, particularly since the annual allowance is already in place to limit tax relief on pensions. Achieving the right balance between an LTA that helps to reduce the deficit by taxing only those with the largest pension funds, and one that is so low it discourages people from contributing to pension funds altogether, is a challenge. Hopefully, if the LTA is indeed indexed in 2018, this will protect pension savers from an ever decreasing LTA (the new LTA is just 66% of the £1.8m LTA for 2011/12).[7] But in the meantime, everyone, however close to retirement, should keep a close eye on their pension fund.

Mark Howlett
CEO

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

---

[1] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[2] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[3] Pensions Advisory Service, Lifetime Allowance Spotlight April 2015.

[4] http://www.theactuary.com/news/2015/03/lifetime-allowance-reduced-to-1million-says-chancellor/

[5] http://www.theactuary.com/news/2015/03/lifetime-allowance-reduced-to-1million-says-chancellor/

[6] Pensions Advisory Service.

[7] http://www.telegraph.co.uk/finance/personalfinance/pensions/11543227/The-death-of-pensions-has-it-begun.html

Try to be Flexible: How SMEs Can Attract Staff

It may once have been true that the most talented individuals would look for employment at large, well-known companies. Substantial budgets allow big organisations to offer higher salaries and broad ranging benefits. However, it is becoming increasingly the case that talented people seek the informal environment and varied workload offered by SMEs. Big salaries have become less important than overall job satisfaction, which is dependent on a myriad factors.

There are countless advantages of working for an SME. Firstly, there are fewer employees and so staff members are able to build rewarding relationships, thus forming solid, more productive teams. A Great Place to Work, a global human resources firm, studied successful workplaces for 30 years and reported that “investing in a high-trust workplace culture yields distinct, tangible business benefits” including attracting “better quality job applicants”.[1] Furthermore, most employees will have the opportunity to work closely with senior management, so work is more likely to get noticed and ideas are more likely to be heard. The environment of an SME is generally less formal and bureaucratic and the work more varied; this keeps employees engaged and drives productivity.

The best employees are most likely to be career-focused people. As such, you will need to show them that you can offer promotion possibilities that come with additional perks along with additional responsibilities. SMEs typically have fewer employees than larger companies and so there is more opportunity to demonstrate creativity and skill. Let potential recruits know that there is room within your SME to develop and flourish and that their efforts will be rewarded with appropriate promotion.

SMEs that are recruiting must focus on projecting the message that their work environment is more progressive and desirable than that of a larger company. A company website is an excellent shop window: photographs and website content (blog posts, for example) should reflect the flexible, exciting environment you can offer as an SME. Optimise your use of social media to connect with younger talent and extol the benefits of working for an SME.

Attaining a better work/life balance has become a high priority for most employees and SMEs are best placed to offer desirable flexible working hours. According to recruitment agency Robert Half, 29% of HR executives found that work flexibility was the main motivator for staff members.[2] The offer of split-shifts, customised hours or telecommuting will appeal to potential workers, particularly those with young families.

An excellent benefit scheme is a way for SMEs to attract high-calibre employees. In their most recent annual trends survey, MetLife reported that in 2014, employees who claimed to be very satisfied with their workplace benefits were almost four times more likely to be very satisfied with their jobs.[3] Similarly, a study by Bupa last year found that 42% of SME workers felt that workplace benefits were the most important consideration when choosing a job.[4] This is good news for SMEs who may often find it easier to make changes to their benefit schemes compared with larger organisations and so are able to integrate features that will appeal to new recruits.

Flexible benefit plans allow employees to select the additional benefits that best suit their lives, such as increased pension contributions, childcare vouchers, subsidised training, and access to mentoring, company cars and entertainment incentives. Healthcare is one workplace benefit that is increasingly in demand as it offers real value to employees.

Attracting the best recruits may seem like a daunting task for some SMEs. But, in actuality, SMEs are more than able to attract staff by capitalising on those aspects of their work environment that separate them from large organisations. Flexibility is of primary importance in the battle for human capital so don’t underestimate the power of a flexible benefit package, not only to motivate existing employees but also to attract new recruits.

Mark Howlett
CEO

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

---

[1] http://www.greatplacetowork.com/our-approach/what-are-the-benefits-great-workplaces

[2] http://www.roberthalf.co.uk/how-to-attract-the-best-talent

[3] https://benefittrends.metlife.com/benefits-impact

[4] http://www.bupa.com/media-centre/press-releases/uk/flexibility-key-to-retention-and-happiness-in-uk-smes/

A Fond Farewell to Webb

Following the disastrous result for the Liberal Democrats in the General Election last week, several excellent MPs have lost their parliamentary seats, including the Pensions Minister Steve Webb. The fact that we are losing, arguably, the best minister to emerge from the coalition, is gloomy indeed. The reforms implemented by Steve Webb, the Minister for State Pensions,[1] have made the current pensions system far fairer and have allowed people far more financial freedoms. Despite receiving over 18,000 votes, Webb lost his seat in Thornbury & Yate to Conservative candidate Luke Hall. In a recent message on Facebook, Webb thanked his supporters for their backing and expressed his gratitude at having the opportunity to serve 18 years in Parliament. One of the sad truths of the way we assemble governments in the UK is that elections sometimes result in worthy and dedicated ministers being cast out; Steve Webb is an example of this in action.

David Cameron recently announced that Ros Altmann, a high-profile campaigner on pensions issues has been appointed pensions minister. Altmann is a City banker by training and previously worked as a director of Saga. Whilst her appointment has been widely welcomed by the pensions industry, only time will tell whether Altmann will have the same impact on the pensions system as Webb did.
During Webb’s time in the Department for Work and Pensions we have witnessed seismic change in the country’s pension system. Despite there being 10.3 million people over the age of 65 in the UK, a figure that has risen 80% since 1951, many of us are not saving enough money to see us through retirement.[2] In order to address this fact the Department for Work and Pensions introduced auto-enrolment.[3] Enrolling employees automatically into affordable and attractive workplace pensions may be a challenge of administration for employers, but auto-enrolment addresses a far greater problem. An ageing population means that more and more of us will be reliant for longer and longer on money saved from past employment. Therefore it is vital that employers honour the legal obligations inherent to auto-enrolment. If needed, there are many means by which employers can seek advice as to how to manage auto-enrolment and make the necessary payments.

Webb spearheaded several radical changes to pension policy. Now, those over 55 with a defined contribution (DC) pension policy are able to spend their pension pots should they wish to, rather than having to wait until their official retirement age. Although these new freedoms have led to concerns that many pensioners will blow their pension pots on “Lamborghinis”, it seems unlikely that those who have diligently saved their money in a pension fund would blow it all at once simply because they can. Indeed, research from Prudential Plc at the time the pension reforms were introduced suggested that only 2% of over 55s were thinking of making large purchases with their pension pots.[4]

It is more likely that pensioners will chose one of the other available options and either take out a small amount of money from their pension each year or buy an annuity. These freedoms signified Webb’s faith in the ability of the UK population to act responsibly. This faith is rarely seen in government ministers.[5] Rachel Reeves, the Labour Shadow Minister for Work and Pensions, expressed fears that some pensioners may be at risk of being ripped off by fraudsters or “forced to pay excessive fees”.[6] And she warned that pension providers were unprepared for the bombardment of people asking for advice on what to do with their pensions.[7] In contrast, when confronted with think-tank proposals to implement default retirement systems for DC pensions savers, Webb rejected them as unnecessary, adding that “There is no inconsistency between helping people do something they would not otherwise do – like building up pension savings – and then recognising that everyone is different and people should be free to do what they like with [their pension].”[8]

Webb is also responsible for the newly implemented 0.75% cap on pension charges. This cap will end the over the top charges enforced by pension providers and initiate a ban to hidden costs. This will make a huge difference to the individual and the UK as a whole: an employee with a pension pot of £30, 000 could benefit by £1,600 with a saving scheme that charged 0.75% compared to one that charged 1.5%.[9] In addition, the government estimates that an extra £195 million of pension contributions will turn into pension savings over the next 10 years.[10] In summary, the benefits are clear: not only are employees automatically enrolled into pension schemes, but their money is protected from excessive charges, and finally, their pension is handed back to them to invest or save or spend upon their retirement.

It is evident that Webb was passionate about the importance of pensions. During his time in Parliament he certainly made a string of bold and decisive moves; but the reforms put in place clearly show that he understood the nuances of pension policy.  Even though Webb is no longer the Minister for State and Pensions, he will be remembered as having an extremely positive impact on the UK pensions industry and is sure to be a very tough act for Altmann to follow.

Mark Howlett
CEO

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

---

[1] https://www.gov.uk/government/ministers

[2] Population ageing: statistics house of commons library

[3] https://www.gov.uk/government/policies/helping-people-save-more-for-their-retirement-through-workplace-pensions

[4] http://www.cityam.com/213081/pension-changes-april-2015-five-things-you-need-know

[5] Gov https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/332714/pensions_response_online.pdf

[6] http://citywire.co.uk/new-model-adviser/news/labour-calls-for-pensions-cooling-off-period-to-stop-scams/a808009

[7] http://www.theweek.co.uk/budget-2015/62997/pension-changes-will-they-come-back-to-bite-britain

[8] http://www.ipe.com/countries/uk/uk-minister-dismisses-auto-protection-as-politicians-clash-on-paternalism/10006953.article

[9] http://www.theguardian.com/money/2015/mar/02/fca-pension-fees-charges-cap-criticism

[10] https://www.gov.uk/government/news/an-end-to-rip-off-pension-charges-webb

For Sale - Annuity Policy. One Careful Owner.

After several weeks of speculation, the Treasury yesterday released its "consultation" on selling annuities (available here). Indeed, the Government seem to prefer to call it a "call for evidence" - which is a bit like saying that it's an idea that George Osborne came up with one evening, after a few beers in the pub with Steve Webb (although Osborne doesn't strike me as a beer type, perhaps it was a few glasses of claret), which still needs to be fleshed out a bit.

The document makes it pretty clear that there's an awful lot of important detail that hasn't really been worked out. For example, the Government still seems undecided about whether to allow annuity providers to “buy back” annuity policies from policyholders, as an alternative to selling an annuity to a third party. The Government is clear that “consumer protection” is required, but the nature of that protection is unclear. Fundamentally, if you are selling your annuity, the advice you need is whether the sum you are offered is a good deal, which boils down to whether the party buying your annuity thinks you are in better health than you really are.

Practical problems - like how to work out when an annuitant dies, if the annuitant no longer has an interest in the annuity policy - are flagged, but the Government doesn't seem to have a clear view on how to solve them.

The Government seems to want to make the sale of an annuity to a third party subject to the agreement of the annuity provider. Now why would an insurance company agree to this? The risk for the insurer is that they overpay on the annuity policy because the new owner of the policy has no idea whether the annuitant is alive or dead. So I anticipate that insurers will be reluctant to agree, unless they can charge a fat fee for the pleasure of doing so - which may simply mean that the option to sell an annuity becomes prohibitively expensive.

Notwithstanding this lack of detail, the Treasury is optimistic enough to budget over £500m in extra tax revenue (in the first year alone) as a result of annuity sales. This must assume that not only will annuitants sell their policy, but that they will also take the proceeds more quickly than would otherwise be the case, thus accelerating tax revenue. There is a certain irony about this - in the introduction to the consultation, the Government says that it "believes that for most people, keeping their annuity income will be the right decision" - yet clearly the Treasury think that enough people will make the "wrong" the decision to give them a significant tax revenue hike.

Ultimately, this half-baked policy feels like opportunistic electioneering – the vagueness of the consultation gives the impression that, post-election, it might quietly be kicked into the long grass, to wither and die.

John Broome Saunders

Actuarial Director

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

Bond yields: unwelcome news for defined benefit pension scheme sponsors

Bond yields are at all-time lows. Notably, long-date corporate bond yields ended the year as low as they’ve been for at least a decade. My handy source of data doesn’t really go back much further, but I wouldn’t be surprised if they’ve never been this low – ever.

 (Source: FT-SE Actuaries indices, Markit iBoxx indices)

This may be great news if you are invested in bonds, but for many defined benefit pension scheme sponsors it is unwelcome news. Unfortunately, pension liabilities on corporate balance sheets should be calculated using a discount rate equal to corporate bond yields. Thus, as yields have fallen, balance sheet liabilities have risen – our friends at Mercer have estimated that overall balance sheet deficits could have doubled over 2014.

Some sponsors may be ambivalent about such balance sheet volatility – taking the longer-term view that what goes up, must come down. But others may be more sensitive, worried about how an apparent weak balance sheet might be perceived by customers, lenders, and possibly even shareholders.

Low corporate bond yields could have other effects. I have a client who pegs commutation factors (the conversion rates used to determine how much pension is reduce by when a member opts for a lump sum on retirement) to corporate bond yields. As yields have fallen, those rates have become steadily more generous – great news for scheme members at retirement, but potentially very expensive for the scheme sponsor. Transfer values are usually linked to bond yields as well, so they too will have become more generous.

Balance sheet volatility may encourage sponsors to try and do a better job of matching assets and liabilities. But trying to match when yields are low means locking in at what feels like precisely the wrong time – unless of course you take the view that in 6 months’ time I’ll still be saying that bond yields are at an all-time low.

John Broome Saunders
Actuarial Director
Telephone: +44 (0)20 7893 3456
Email: contactus [@] broadstone.co.uk

Collapsing yields prompt another pensions crisis

With long gilt yields hovering just above 2%pa, many pension scheme deficits will be looking rather unpleasant.

Since the beginning of 2014, yields have tumbled by over 1.5%pa – that could easily mean a 25% increase in the liabilities of a typical defined benefit (DB) pension scheme. Typical risk asset returns have been moderate at best – UK equities, for example have returned 1.2% over 2014. Some pension schemes may have been able to hedge some or all of their long-term interest rate risk – either by investing in bonds, or using ‘Liability Driven Investments’ (LDI) to match scheme assets with liabilities. But many schemes will not be completely hedged in this way, and will now be suffering from significantly increased deficits – on pretty much any calculation basis.

Looking forward, the prognosis is bleak. With the European Central Bank beginning its own Quantitative Easing programme, there doesn’t seem any immediate prospect of higher yields – indeed, some commentators, think that yields could fall still further.

What should DB scheme trustees do? Fortunately, most only need to get out of bed and worry about how to fund deficits every three years, so many may well pull the covers over their eyes and keep their fingers crossed that, by the time the next valuation comes around, the position is a little better. But those with valuations now are faced with the unpleasant prospect of asking sponsors for more cash. Some sponsors may be able to find a few extra pennies, whilst for others deficit funding may be driven primarily by affordability - in which case there’s probably no chance of extra cash no matter what the actuary says.

Of course, schemes that hedged their interest rate risk a few years ago will be feeling very smug indeed. But hindsight is a wonderful thing.

John Broome Saunders

Actuarial Director

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

Leaving Service - What Happens Next to your pension?

In today’s workplace, the days of a job for life are long since over. Many people will change jobs ten to fifteen times during their working careers. Their workplace pension can become a casualty of these frequent changes, with pension arrangements being made and removed on leaving the employer.

Most of the UK’s leading pension providers follow a standardised process which ensures that the former employee retains their benefits and ceases the pension relationship between themselves and their former employer.

At the time of leaving service with their current employer, employees will receive a leaving service pack which will confirm their options and most likely include a direct debit instruction to continue contributing to their pension personally.

The pension plan is converted by the provider into an individualised arrangement, and once this change has been made both the employer and their engaged financial adviser, both cease any liability or obligation to provide assistance to the former employee.

Starting a new job will most likely result in an additional pension being set up for the employee by their new employer. The employee can then choose to transfer the existing plan into their new arrangement or continue with two (or more) plans. This can create administration issues both during employment and at retirement.

Employee awareness and understanding is therefore vital to this process and it is the responsibility of the employer to ensure that the employee knows what comes next.

Robert Simmons

Corporate Pensions Administrator

Telephone: +44 (0)20 7893 3456

Email: contactus [@] broadstone.co.uk

The importance of a good payroll provider

With the changes in pensions legislation that have occurred over the last few years, the role of the payroll provider has changed in its importance to the company pension scheme. Before they enjoyed something of a backseat role, but now they have been thrust to the forefront of a company’s dealings with its pension provider.

Automatic enrolment has added extra layers of complexity into the process of assessing eligibility, managing the membership, data, and contribution payments for pension schemes.

As with any dealings with an individual or firm, you get out what you put in and with payroll providers it is no different. Employers who bring their payroll providers in to this process early, often find that the teething issues most pension schemes encounter can be greatly reduced.

However it is not just the employer’s responsibility to bring their payroll providers in on the pensions process, it is also the responsibility of the pension providers themselves.  For some it can be as simple as inclusion on regular conference calls, and for others far more specific inclusion and training is required.

Encouraging a greater awareness of the automatic enrolment process on the part of the payroll provider should be the overriding aim of both the employer and the pension provider respectively as auto enrolment becomes more established in workplace pensions.

Robert Simmons
Corporate Pensions Administrator

Telephone: +44 (0)20 7893 3456
Email: contactus [@] broadstone.co.uk