Small firms concerned over pension scheme changes

Date: 27th September 2010

The majority of the UK's smaller firms are concerned about the cost of government plans to automatically enrol workers into pension schemes, a survey has revealed.

A poll by the Association of Consulting Actuaries (ACA) found that just 54 per cent of small businesses support the changes, while 53 per cent think the reforms will have a significant impact on costs.

Under the plans currently being drawn up, workers at smaller firms will be automatically enrolled into company pension schemes, although they will retain the right to opt out.


Individuals will have to contribute at least four per cent of their salaries, with companies paying in three per cent and the government contributing a further one per cent.

ACA chairman Stuart Southall said: "The cost of pensions to both employees and employers is the big issue that has prevented the extension of pension provision to date in the sector.

"Whilst auto-enrolment may break the mould, if we are all still paying higher taxes to recover over-spending, it's difficult to see how this will not bump up opt-out rates."

Posted by Thomas Fletcher