Pensions auto enrollment

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After ten years since it was first muted, automatic enrolment for employees into an employer sponsored pension scheme finally went live on 1st October 2012. There is perhaps the inclination to think that now the systems and processes are

in place we can relax. Indeed, NEST has been open for business and has had members since July last year –working with over 300 employers, including more than 100 large firms that have chosen to use NEST to meet their automatic enrolment duties. These include household name firms such as the BBC, BT, McDonalds and Travelodge.

But in reality, the hard work is only just beginning. Over the next five years, over 1.2 million employers and up to 11 million workers will be automatically enrolled into saving for a pension, many for the first time and as time goes on, the sheer numbers of employers facilitating arrangements means one on one support from the actual scheme will not necessarily be an option. During summer 2014, 25,000 employers will hit their ‘staging date’ – NEST alone expects to welcome about 5,000 employers during this period and while it is simply not practical to engage with them on an individual basis, NEST will provide support in a number of different ways. It can take up to 18 months to put everything in place to comply with the duties. While there’s no getting round the work employers have to do to get ready, NEST has been built with simplicity and ease of use very much in mind, from the initial set-up, to its award-winning investment strategy to managing the opt-out process.

NEST also offers delegated access, which lets employers appoint an IFA to set up and run aspects of the scheme on their behalf. By contacting us for an initial discussion or to request a meeting at your work place. You can find more about how Mark Hughes & Associates  are working with employers to ensure that they are both compliant and offering a suitable pension solution for their employees.

Automatic enrolment is both a challenge and an opportunity. The scale of the task at hand is great, but represents a once in a generation chance to foster a culture of saving for retirement in the UK, it should also be an opportunity for employers to add value to their employee propositions.

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