Small businesses can’t dodge pensions auto-enrolment

Extracts from an article by David Prosser, journalist at Money Week.

“Small businesses take note: pension watchdogs have vowed to crack down on employers discovered to be encouraging their staff to opt out of the auto-enrolment occupational pensions system in order to cut costs. In the first three months of this year alone, the Pensions Regulator issued 35,862 enforcement notices against employers in breach of the auto-enrolment rules, relative to 28,446 last quarter.

Auto-enrolment obliges employers to enrol almost all their staff into the workplace pension scheme and to make at least a minimum contribution on their behalf, unless workers have specifically opted out. And so far, this application of the “nudge theory” appears to be working. Between the introduction of auto-enrolment in 2012 and last year, pension-scheme membership in the UK has hit record highs, with 85% of staff employed by small and medium-sized enterprises choosing to stay within the schemes set up for them, according to the Department for Work and Pensions.”[..]

“Small and medium-sized enterprises (SMEs) are winning more government contracts than ever before, new data shows, with hundreds of millions of pounds worth of deals coming up for renegotiation before the end of the year.

SMEs accounted for 62% of the 23,100 suppliers that won government contracts last year, up from 51% in 2016, according to Tussell, a market intelligence consultant specialising in public procurement. The consultant urged SMEs to exploit the opportunity of an unusually high number of tenders due for completion before the end of the year, with £565m worth of government contracts due to be awarded in the technology sector alone.”

Read the full article on the Money Week website.

Receive free Tussell insights

Get relevant market updates sent to your mailbox