Following the announcement of business pension legislation being introduced from October 2012, I have said from the start that this will seriously affect the economy and that it may be better to wait until growth begins to take off again before introducing such significant reform. It seems now, following an article written in the Sunday Times (9th October 2011), that the government may be considering putting a hold on auto-enrolment. ‘A government report recommends delaying the introduction of the flagship new system, due to begin next year, and suggests smaller firms could be exempted altogether’
This was suggested by Adrian Beecroft who also calls for a drastic reduction in the workers’ rights and is critical of coalition plans to make maternity leave more flexible. Beecroft believes that automatic pension enrolment could prove a huge additional financial burden on small businesses at a time when many are already struggling. He also has concerns about the impact on consumer spending, with as many as 7 million workers not currently saving for their retirement suddenly receiving significantly smaller pay packets as their pension contribution is taken from their salaries.
We should hear something from the government before the end of 2011 as to whether the plans will go ahead or whether there will be a delay introduced for smaller companies.