Commenting on DWP’s consultation regarding pensions auto enrolment, Steve Simkins, KPMG’s head of public sector pensions, urges public sector organisations to participate:
“There is little that is compelling about the application of the auto-enrolment legislation for the public sector. In a sector where contractual enrolment already exists into good quality pension schemes, and take up rates are high, what does the new auto-enrolment legislation really add?
It is seen by many public sector employers as an administrative burden and a tick box exercise to achieve compliance, without much meaningful impact. It also risks employees with multiple posts being confused by multiple communications and scheme memberships.
At a time of public sector spending cuts the additional cost and the strain on under-pressure internal resource represented by the need to comply with auto-enrolment legislation is wholly unwelcome.
This appears to have now been recognised by the DWP. In its latest consultation it asks whether it would be a good idea to allow employers that are contractually enrolling all workers into an automatic enrolment qualifying scheme to be able to certify in some way that they meet the policy objectives. This could then lead to an exemption from the explicit employer duties.
The largest public sector employers, who have already staged, may wish that DWP had acted sooner on this consultation, reflecting the fact that the auto-enrolment legislation was designed to meet the needs of the private sector.
It will be interesting to see how many public sector employers respond emphatically to the consultation and to track what the outcome of the consultation will be. It ends on 7 May 2013 with any changes being brought in by April 2014.
Public service employers who have not already passed their staging date, especially those with high membership levels already, may be well advised to take advantage of the Transitional Period, respond to the consultation and meanwhile undergo the minimum work possible, with a view to expecting an exemption and much needed simplification of the requirements.
There’s a lot to be gained from participating in the DWP consultation as the suggested relaxing of the public sector obligation would surely be a welcome relief for those working in public service.”
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Alison Anderson, KPMG Corporate Communications
T: 0113 254 2980 E: email@example.com
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