The best business advice, opinion, news and expertise in Greater Manchester and further afield.

Thursday, 27 September 2012

Be Prepared

By Chris Fletcher - Policy and Communications Director, Greater Manchester Chamber of Commerce

This Monday, 1st October, sees the second common commencement date of 2012 heralding new legislation and changes to employment laws. In line with the Government’s ambition to drive down red tape (one-in, one-out), there is not a deluge of new rules coming in, however the main one to be aware of is the official start of pension auto-enrolment.

This has been in development for several years and is a legacy from the previous Government aimed at ensuring that every worker has provision for retirement to offset the increasing burden on public pension funds.

The first phase of this is aimed at businesses with over 120,000 employees with the aim being that the staged roll out of the scheme will see all businesses included in the scheme by 2017 and any new start-ups included by 2018.

Auto-enrolment is a real double edged sword. On the one hand, looking longer term, it is necessary to help reduce the pension burden, on the other it is probably coming at the worst time possible as firms will have to find extra resources when they can probably least afford to. We’ve calculated that overall, once it is fully up and running, it will be costing Greater Manchester businesses £170m a year.

It is important that businesses are aware now of when they will fall under the terms of the scheme – some businesses will be running company pension schemes that will mean they already meet the minimum standards and requirements.

For most of our members this will be a couple of years away however it is always better to plan ahead now and be up to speed with what is required.

Full details of the scheme including the full list of staging dates can be found at: www.pensionsregulator.gov.uk/automatic-enrolment.aspx 

And if you want more information on all potential changes and how successful the one-in one-out system has been (including how much it has “saved” you), full details are here: http://www.bis.gov.uk/policies/bre/one-in-one-out/statement-of-new-regulation

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