Auto-enrolment should be win-win:
There will be 1.8 million employers setting up and contributing to pension schemes for the future financial security of 5.5 million people - resulting in a new £17.5 billion pool of investable assets for the UK’s economy.
Smiles all round, right?
Unfortunately, we have a way to go - because inflexible payroll systems are preventing everyone from maximising the benefits of workplace pensions
Many workplace pensions schemes aren't open to everyone. Instead, they only work for employers using a specific payroll system. Often, this payroll system needs an 'expensive upgrade' to adjust to the new pension set-up. This means that, worryingly, many software products dictate which pension scheme or master trust employees can invest in.
Such is the emphasis on payroll solutions that many accountants and their employer-clients believe auto-enrolment is an issue for payroll teams to take care of – an administrative burden that can be solved by software.
Is this right? Should the choice of 5.5 million people’s pension funds be reduced to ‘Whatever works with the payroll software?’
The best workplace pension schemes are payroll agnostic
Workplace pensions aren't a software or process issue - they're a business issue, because they're tied in with key drivers around staff recruitment, retention and growth.
Therefore, pension scheme selection, set up and ongoing management - including communication between employer and employees - should be led from the top. Hard-working staff deserve the right pension scheme, one that's viable and sustainable. An investment vehicle that will still be there in 12 years’ time when it will finally start to make a profit.
And choosing the right scheme isn't difficult - you can get a customised shortlist of providers in less than 5 minutes using the Husky pension selector tool.
Why introduce risk into your business when it's so easy to turn auto-enrolment into an opportunity to show you're an employer of choice?