The implementation of the workplace pension has been ongoing since 2012 and is now reaching the lower end of the market and it is believed that there are around 1m companies to yet join. Most of these are small and micro companies
When the scheme was originally implemented many experts did say that there simply was not enough capacity in the financial industry to cope with the lower end of the SME sector given that this is 95% of all UK companies,
Possibly the biggest challenges facing small business are the potential costs, the time involved in setting up the scheme, implementing and ensuring everything is recorded and filed. Many companies have already missed staging dates and suddenly are finding they are being fined, which can be up to £10,000 a day
Once implemented there is also the issue of the payroll and at this stage, many payroll systems at the small end do not have a connection built in to make the payments to the pension company.
The crunch is coming and for both employers and the pension industry. Pressure is now mounting from The Pension Regulator on the bottom end of the SME sector and fines are now being issued for missing staging dates. In some cases, employers have put their trust in a “pensions expert” only to find that nothing has been filed on time and they are being fined.
Even when the employer signs up there is the matter of transferring information between their payroll system and the pensions company for each payroll run as well as dealing with leavers and new employees. This will inevitably involve additional time and costs
ibd has spent some time looking at this and we felt there has to be a better way that removes much of the management time from the process, strips out costs and ensures compliance. The traditional route clearly is not going to work for the small employer and ibd has now an On-Line Solution in conjunction with UK Policy Management and The Workplace Pensions Group. This allows Employers to do the process online including scheme selection, adding in employees, communicating the payroll information to the selected pension company and producing all the required Compliance documents. The whole process can be done in under an hour and there is a UK based help desk if there are any questions