Small and micro businesses to spend £300m on auto-enrolment set up

 Between now and 2018, an estimated 1.8million of the UK’s small and micro businesses will begin to ‘stage’ (be required to set up a workplace pension), with up to 500,000 doing so in 2016 alone according to The Pensions Regulator.
 
According to TPR research, small employers that have already staged have paid between £200 and £1,000 for advice on setting up a compliant workplace pension scheme, with the average cost £440.
 
Based on TPR findings that show around 40% of employers with 1-4 staff paid for help to set up a workplace pension, the 1.8m small and micro UK businesses yet to stage are collectively looking at a bill of £317million between now and 2018.
 
But smaller UK firms don’t need to pay for a workplace pension: a number of providers charge no set-up cost while some also automate the set-up and contributions process.

These technology-based platforms effortlessly connect a company’s payroll to a pension scheme via an API (Application Programming Interface). One of the leading examples is the API provided by the government-backed Nest pension scheme.
 
Catherine Pinkney, co-founder of payroll and pensions platform, Paycircle, comments:
 
“With the vast majority of the UK’s small and micro businesses now starting to stage, it’s more important than ever to broadcast the message that there are ways for companies to set up a fully compliant workplace pension scheme themselves at no cost. We need to debunk the myth that only an expert can take care of your auto-enrolment because it’s highly technical: that’s what certain advisers may want you to think but the reality is quite the opposite. It doesn’t have to cost a penny and, for smaller companies, can be done in little over an hour. Clearly some business owners will want the reassurance of someone else setting up their workplace pension, or a more bespoke scheme, but for those who would happily do it themselves and simply want to abide by the rules, the DIY option is much easier and quicker than they think.”