Auto-Enrolment: Aviva Explains

Auto-Enrolment: Aviva Explains

Professional Builder talks to Andy Beswick, Managing Director of Business Solutions at Aviva, about auto-enrolment and how it will affect you.

With 480,000 SMEs on course to set up a workplace pension by the close of 2016, it’s of the utmost importance that people are aware of what needs to be done in order to stay on the right side of the thin blue line. With that in mind, we spoke to auto-enrolment expert Andy Beswick to find out more about the scheme.

“The government has said all employers have got to take out a workplace pension on behalf of their employees – this is called auto-enrolment – and there are just under half a million small businesses that have got to set up a scheme in 2016,” explains Andy, “and there’ll probably be more like a million in 2017.

“The auto-enrolment project actually started in 2012, but it focussed initially on the very large firms, making sure they were offering workplace pensions. It’s only been since the start of 2016 that the focus has switched to small employers.

“The end goal is essentially to ensure that all employees in the UK have access to a workplace pension that both they and their employer are contributing to.

1413_Plasterer close upIf I have a business, what does auto-enrolment mean for me?

“So, you have to know when your staging date is. Your staging date is the date by which the Pensions Regulator has said you need to have established a workplace pension.

“To implement the pension, employers have a choice. They absolutely can do it themselves – the services we’ve launched allow employers to go online, quote and apply for their workplace pension in ten minutes. That’s the process Aviva has set up.”

And the costs?

“There are undoubtedly costs associated with the scheme. The government has set the minimum at one-to-one between employee and employer to contribute. That will go up in stages between now and 2019.

“Companies are perfectly at liberty to pay more should they think it’s the right thing for their staff and to keep their staff. I’m no expert on running a small business, but if you had a really good member of staff you would want to make sure their remuneration made them a. feel valued and b. much less likely to go somewhere else.”

What effects will the scheme have on the construction industry?

“I think it’s inevitable that if you want skills that are scarce in the market, the rate of remuneration that you offer for those skills will determine how successful you are in getting them.

“Once small companies get on board with auto-enrolment, they’ll realise that when you’ve got a skill shortage particularly, a workplace pension is actually a really attractive benefit.”

Aviva’s top tips to auto-enrolment

1) Find out your staging date.

2) Decide if you need some support. If you have a financial or business adviser, or an
accountant, they should be able to help.

3) Don’t stick your head in the sand. It is a legal requirement for all employers, no matter
what size, to have a workplace pension scheme. Start preparing for it as soon as you can
and act now.

4) Choose wisely. The priority should be that business owners end up with a scheme that
works well with their systems, is easy to run and is positive for employees. It also needs to
be able to adapt as the business evolves.

5) Talk to your employees about the pension scheme. A workplace pension is a very
attractive benefit that your workforce should be aware of.

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