How to avoid the auto enrolment capacity crunch
IRIS have identified 4 challenges of automatic enrolment. Challenge 1 will be the capacity crunch – look out for more challenges coming shortly!
‘We’re all in’ is the catchphrase of the auto enrolment adverts and while it is true that it will affect everyone at some point, the number of workers who are ‘in’ an auto enrolment scheme at the moment is just the tip of the iceberg.
2014 is the first big year for auto enrolment when over 30,000 companies will reach their staging but this is a tiny number compared to the huge number of 850,000 businesses who will stage in 2017.
How the number of companies staging will increase:
Don’t get swallowed up by the tsunami
Experts are already predicting there will be a capacity crunch as IFAs and pension companies will not have the resources to handle the huge numbers of companies that will need their assistance. This will lead to:
- Lack of choice in pension schemes
- Prices increasing as demand outstrips supply
- Long lead times for advice and set-up
Preparing early will mean you can have your pension scheme and systems in place and can relax while other companies are battling against the tide!
What you can do now
Start to plan for auto enrolment as early as you can by making sure you know the key steps you’ll need to take.
Early indications are showing many businesses are already under-estimating the amount of time needed to get everything in place and have already missed (or are in danger of missing their staging dates).
Tip 1: Know your staging date as it may be sooner than you think. Don’t rely on receiving a letter from the TPR as it may have been discarded by someone else within your organisation or be lost in the post.
Tip 2: Prepare early. Research has shown that 52% of companies wished they had started to prepare for automatic enrolment earlier than they did. Starting in plenty of time (and experts including TPR and NEST recommend preparing at least 12 months in advance) means you don’t have to rush through getting everything in place.
Tip 3: Understand the legislation so you don’t miss any key steps. Once you understand what you need to do you can start to get your systems and processes ready.
How IRIS can help:
Training: You don’t have to spend weeks learning reams of legislation as IRIS has put everything you need to know into an easy to understand auto enrolment training seminar.