Now: Pensions to add employer auto-enrol charge
Automatic enrolment provider Now: Pensions is to introduce an employer charge of up to £40 a month for those employers who register with them on or after 1 October 2015 and who have staging dates from 2016 onwards.
Lisa Kennery, our Payroll Manager says, “ACT NOW; Small employers with 2016 staging dates and beyond who have not yet enrolled in a pension scheme, really need to contact us to hear these details.
A possible £40 per month is a considerable sum for small employers to find. If applicants register with NOW: Pensions before 1 October even though their staging date is not until 2016 or beyond, they will avoid the charges described below.
The choice of low cost pension providers may be severely restricted in the near future. Small employers who wish to minimise costs really need to get in touch with us this week.”
Concerns have been growing that firms yet to auto-enrol will have to turn to NEST (The National Employment Savings Trust) as other providers struggle to make money out of the smaller firms.
Now: Pensions director of policy Adrian Boulding said in an earlier statement that; “The firm will use research to improve services for small employers – such as giving each employer a dedicated member of support staff”
Boulding says: “We are going to charge employers. We’ve made a decision we want to remain open to all employers of all size and provide them with the help they tell us they need to help them manage auto-enrolment.
“But to do that we are going to levy a charge for new employers that join us from 2016. We don’t know what the charge will be yet, because we haven’t asked employers what services they want yet. But we are making a commitment today that it will be no more than £40 a month.”
“We think it’s something that a small business – if they value the services – will be happy to pay. If we get the consultation right we will be delivering the services people have told us they need and would value.”
Boulding adds: “The majority of small employers do not have an adviser, many will use an accountant. They are expecting their pensions provider to help them with the day-to-day nitty gritty of things like filling out forms.
“We are trying to find out exactly what help small employers need – is it a call centre, or a named individual in a call centre or the ability to share computer schemes?”
An announcement was made by NOW: Pensions on 17 September 2015 that the launch of this charge will not apply to any firm that already has an accepted contract with NOW: Pensions even if they are staging in 2016 or beyond.
To handle the growing demand, NOW: Pensions has increased its contact centre capacity significantly and in November is opening a second office in Nottingham with the creation of 250 new jobs over the next two years. Many of these jobs will be in front line client support.
NOW: Pensions recognises the needs of smaller employers are fundamentally different to 54,000 employers that have already staged.
They state in their release of Thursday 17 September: When it comes to selecting a provider for auto enrolment, one in four (26%) employers intend to seek help from their accountant, one in six (16%) are relying on their existing scheme provider and one in ten (12%) plan to search the market and do the research themselves. Just one in 20 (6%) of small and micro firms intends to seek help from an independent financial adviser.