There are no plans at the moment to provide small businesses with financial support when the new national pensions scheme comes into force in 2012. Under the personal accounts scheme, detailed in the government’s pensions white paper, employers will pay 3 per cent towards the retirement savings of their employees. A number of employers’ groups, including the Federation of Small Businesses, the Engineering Employers’ Federation and the CBI, have been lobbying the government to subsidise smaller businesses that may otherwise struggle to meet the costs of making and administering the payments. Employers want small businesses to be refunded a proportion of the contribution they must make to employees’ pensions in the same way that maternity pay is reimbursed. However, the Department for Work and Pensions has indicated that there is currently no commitment to funding small businesses in this way. As part of the latest consultation on the new pension scheme, the DWP deferred any decisions on financial assistance to a much later date, saying that “the question of any direct fiscal support must be a decision for future governments based on the fiscal position at the time”. The DWP did promise that the burdens imposed on small businesses would be made as light as possible. Employers will not be expected, for example, to take on the role of financial advisers to their employees. Other ways of helping smaller firms could include giving employers the opportunity to self-certify that the pension schemes they may already run provide better terms than the new personal accounts and so to opt out of the new pensions scheme. Date:10 July 2007
Content by: Made Simple Group
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