The Pensions Regulator

[BroadOaks]

I just wanted to find out more regarding this Pensions scheme that we need to provide to our staff from any time soon! Our staging date is apparently January 1st 2017

 

I have a checklist to go through for this Automatic Enrollment thingy?! So basically does anybody know anything about this extra financial burden on our businesses? :unsure:

 

Thank you and this should be an interesting discussion once again ::1a

[Guest]

Our staging date was 1st Feb 16, not sure why it was so early when we only have 5 staff, but hey ho. Cost wise it obviously depends on how many people you have who will qualify, we only have 2, but in the first year you will have to contribute 1% of their qualifying earnings as a minimum which is their earnings that fall between £5,824 & £42,385 (think this possibly changes each year) so if they were earning £20,000 (unlikely I know!) the qualifying earnings would be £14,176 and you pay 1% of that over the year.

 

That's my understanding of it anyway in my recent dealings with it.

[GFCCCC]

It hasn't turned out to be as much of a nightmare as I thought it was going to be. I have over 60 staff - most are eligible. Everyone is on the living wage or more so I envisioned it costing an arm and a leg. Some have chosen not to join and at the moment it is costing me about £400 per month - that will go up over the next two years but it's not too bad.

[Rafa]

It hasn't turned out to be as much of a nightmare as I thought it was going to be. I have over 60 staff - most are eligible. Everyone is on the living wage or more so I envisioned it costing an arm and a leg. Some have chosen not to join and at the moment it is costing me about £400 per month - that will go up over the next two years but it's not too bad.

 

And how are you covering the extra £400 GFCCCC? Thats alot of money in my book!

[Fredbear]

Well we will be bankrupt by this implementation and the introduction of the living wage. As it shames me to say that some of our wonderful staff are currently on the minimum wage, which is a disgrace in my humble opinion.

But the monies not in the pot so what can we do.:(

[Guest]

Let's go on strike!

[Mouseketeer]

https://www.moneyadviceservice.org.uk/en/tools/workplace-pension-contribution-calculator

 

this is quite useful.

[Greenfinch]

My staging date was Feb 1st.

I asked on here last week as I am so behind with everything and had a major panic until I looked! Anyway, was v relieved to see that you can postpone when i looked into it if you meet criteria and also, my staff don't qualify apart from possibly 2 out of 5 so not too stressful after all ( makes a change!)

[GFCCCC]

And how are you covering the extra £400 GFCCCC? Thats alot of money in my book!

You're right - it is a lot of money. I was just making the point that it wasn't as much as I had feared, but it is still an extra expense. I don't mind the staff having benefit that is due to them but I'm not convinced many of them will benefit from this paltry pension and I fear the government will use what bit people have saved to reduce the state pension they give them. Unfortunately we have had to put the fees up slightly to cover it which makes no sense as parents who are now having to pay pension from their own wages are also having to pay more in fees.

[BroadOaks]

Thank you once again for all your help and comments.

 

Why is it that employers' pay more towards a person's pension than what they pay themselves? This is true with PAYE and now this new pension scheme.

 

Why is it an employer's responsibility?! If somebody want's a pension.. let them pay into a private pension and have done with it!

 

Now this get's me thinking (as usual ::1a )

 

Pension Scheme's - a pot of our money in a bank account for many, many years gaining interest right?

 

 

 

 

The problem is if you check the spoiler above.. we will have less workers per pensioner, in a few years time. And it's quite possible this pension money is not being saved by the government, but being used within budgets and classed as capital and invested over the years, and maybe even being used to surplus the economy.

 

So in basic terms.. there is not going to be enough money in the pot.

 

So is this the reason now that a new Pension "scheme" is being used? And will the same thing happen again in another 30 years.. (around the time i need to cash out)

 

I will say it again.. why not just allow people the freedom to sort a private pension out for themselves.. and stop these "compulsory" pension schemes?!

[GFCCCC]

The employer doesn't have to pay more with the schemes that have been set up for the new workplace pensions. In year one to three we pay the same and then the employer sticks at 3% and the employee pays 5% thereafter. At the moment my staff are all paying 1%, I suspect once it goes up to 5%, some of the employees will drop out - it's one thing paying £10 per month from salary - it's another thing altogether paying £50!

[BroadOaks]

Ahh yes, i have just tried the calculator Mouse posted above.. from 2018 us employers get the benefit of not paying more than the employee..great! ohhh wait, but the contribution just doubled!!!

 

What a complete and utter crock of poo poo!

[Mouseketeer]

On the training we were told not to expect the employer contribution to remain at 3% as the likelihood is itwill go up to 5% in time :-(

Edited February 8, 2016 by Mouseketeer

[Guest]

Well, we only had two to enrol and one of them has opted out and the other has resigned!

[Guest]

I went to a briefing session about this last night, and hadn't realised before that based on current proposals the employee contributions are going up to 3% in October 2017 and then to 5% in October 2018. We were also told that the schemes are set up to be reviewed on a 3 year cycle, so currently an employee would have the option to join or leave every 3 years. So if this is correct, they need to understand they are committing to those increases, as well as the ones the employers have to make. They did say some companies may offer an annual rather than 3 yearly review.

My staging date is January 2017 so have only just started to move forward with this.

[BroadOaks]

I don't want to sound like a scrooge or that i don't care about a persons future here and i am going to ask a serious question that i actually do not know the answer to:

 

Why do employers have to pay towards a persons pension?

 

The reason i ask is due to the following: A person work's and get's paid for working the hours they do. In this country i believe the minimum wages are reasonable if not high. When i compare them to a country like China for example. Many would say they are quite low in comparison to other European countries. Anyway, so as i was saying, a person is paid a wage. This wage is then spent by the employee however they see fit. If they want to save for their pension.. let them!

 

Do i sound harsh?!

[Mouseketeer]

I don't know Broadoaks.....and will the person who opted out still receive the same at the end of the day or will what you've saved yourself be on top of the state pension ...a question I wish I asked at the training

 

I expect it will have a knock on effect to pay increases.

Edited February 12, 2016 by Mouseketeer

[Rafa]

Well i have kept my head well and truly in the sand with this. I don't know when my staging date is - have'nt looked! I am pretty sure no-one will be eligible - but agree with Broadoaks - if you want a pension - get a private one! To expect us poverty stricken pvi settings to be able to offer such a deal is - to me - unbeliveable! We don't even know what our budget is going to be from one year to the next, so how can we say ". Yeah I can pay 3% of 5% or whatever, of your salary for the next umpteen years"!! Not sure I can guarantee paying any salary next year - what with the 'living wage' increase -!thats costing me an extra £1500+ a year and I can't imagine where that moneys coming from!! Certainly not from any funding increase, thats for sure!

[lynned55]

You MUST find out your staging date, to bury your head in the sand (as tempting as it is ) could be bringing you further problems. The penalties for not doing this for your staff or doing it late can be quite severe (cant remember what!) Although I only have 2 staff eligible (i.e that are automatically enrolled) I have another 5 that can if they want to and that if do so we (the group) will have to pay towards it. At the moment (thankfully) none of them do however who knows what will happen in 3 years- we could have 6/8 staff that we have to contribute to.

 

Broadoaks- I tend to agree with you- I really dont see why employers should contribute towards pensions (apart from it saves the gov money) I think it would be a lot easier if there was possibly a cut off- so if you employ less than a certain amount of people you dont have to qualify?

Mousie, any private pension is on top of your state pension. But be aware there can be tax implications if the combined take you over the tax threshold. Then of course there is always the thing (certainly for women who gave up work to look after children) your NI contributions may not be enough to get you a full state pension anyway.

 

Personally, I think that by the time my eldest daughter (34) is eligible to claim her state pension it will no longer exist as we know it but (as child benefit has) will be totally means tested.

[Mouseketeer]

I pay as self -employed to so will be expecting 3 lots .....what was that 'dream on' ? ;-p

[Rafa]

You MUST find out your staging date, to bury your head in the sand (as tempting as it is ) could be bringing you further problems. The penalties for not doing this for your staff or doing it late can be quite severe (cant remember what!) Although I only have 2 staff eligible (i.e that are automatically enrolled) I have another 5 that can if they want to and that if do so we (the group) will have to pay towards it. At the moment (thankfully) none of them do however who knows what will happen in 3 years- we could have 6/8 staff that we....]

 

OMG now my head is out of the SAND!! Have not to date received a letter re my staging date....so just Googled it and Its November16!! Been through the ins and outs of the process and no wiser! Hate this stuff.

Can anyone point me to a Pensions scheme they have found easy to access? I will have one automatic enrolement. And what do you do for yourself if your self employed? I'm in PANIC mode niw - but thank you lynedd55 for kicking me uo the backside!

[lynned55]

Are you sure you didnt get a letter? We've had ours for over a year now and our staging date was only this month.

 

Go here its full of info and guidance. I'm sorry not sure what happens re self employed. Who does your payroll, they should have some info on this as well. Dont panic, I'm sure it can be sorted and the pensions regulatory site is very good and full of info.

[Guest]

I have about 10 years to work before I retire and I dont think this would be worth me paying into.Also to me its just another way to hit groups like mine.....a small group with just 4 employees and another way to make people save up in government coffers.

 

Like the living wage is a way for government to cut the Working TAx credits bill......

[Guest]

Are you sure you didnt get a letter? We've had ours for over a year now and our staging date was only this month.

 

Go here its full of info and guidance. I'm sorry not sure what happens re self employed. Who does your payroll, they should have some info on this as well. Dont panic, I'm sure it can be sorted and the pensions regulatory site is very good and full of info.

Only just got our letter and our date is next Feb......

[Rafa]

No definately no letter - but have registered for email contact now, so feeling a bit more in control???!

Agree with Wendy123 - for those of us that are nearing retirement or have 10 years or so to go, the return in a pension will be very little.

Not many of us will still be sitting on the floor aged 67! (my SPA) - Id rather save the money myself - under my mattress!

[Mouseketeer]

Have you selected a pension provider yet Rafa, on the training we were advised to register with one at least 6 months before our staging date ( mine is March 17). You can postpone if you meet certain criteria ....but not sure what this

[Rafa]

Have you selected a pension provider yet Rafa, on the training we were advised to register with one at least 6 months before our staging date ( mine is March 17). You can postpone if you meet certain criteria ....but not sure what this

Ah not yet Mousekeeter, still getting my head around it and now you've mentioned the word POSTPONE (!) Im thinking.....,maybe thats me?... will I fit the criteria?......(historically I never fit criteria - life can be that unfair!) and traditionally I'm a last minute girl....so 6 months you say, that means I can 'think' about it for another...10 weeks!!!

 

I really cannot be bothered with it all - I have sooo many other things to do and am finding the 'job' is becoming so much more about admin and finance, rather than the children and running a little village preschool - I just hope it will go away - but that said I WILL look into it - any tips or suggestions welcome.....within a 10 week time frame, of course!!

[Mouseketeer]

I'm going to register with 'Nest', my training was through our payroll company 'Devon psla', they said they couldn't tell us who to use but did refer to it quite favourably and a few people there said they already signed up to them and found the process pretty straight forward.

If you don't already use a payroll company Devon psla ( I'm not in Devon, and you don't have to be psla member but it's a bit cheaper) are brilliant and the inclusive package sorts it all out for you, sends out which letters you need to give to which staff when, works out how much and for who you need to give your provider :-)

[SueJ]

I suspect that I will go with NEST too as having done a little bit of looking around some of the schemes make a charge to the employer NOW Pensions for example want over £40 per month (nearly £500 per year) for their Employer Service Charge to "support" employers - sadly I can't afford that kind of support.

 

I did have a word with my accountant who suggested that employees putting their pension contributions into NEST pay more in member charges than some schemes but at least they are free to the employer !!

[Guest]

I use an accountant and have added them to be a contact as well as myself so hopefully will get some support.