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Huzzah ...
... a voice of common sense - it is imperitive that there is a single data standard that the pension regulator uses and that the pension providers use.
Pension providers have had enough cream from investors over the years to produce a standard so that payrolls can automatically transmit data to them alongside the pension regulator submission, FPS, EPS etc.
The admin burden on small firms wil promote non-compliance, not through will, but through inability to cope, in terms of expertise and finance, and the draconian penalties will drive large numbers of small businesses to the wall.
A common data standard and simple push button method of sending data to teh pension provider will hopefully offer some hope of avoiding that.
But, all this should have been sorted out years ago, one wonders why the vast salaries are paid to the people who devise these schemes, as frankly, time and time again they demonstrate at the expense of small businesses they are not competent to organise a [***] up in the proverbial brewery, let alone the biggest change to business legislation ever.
Common data standards
I don't think that pension providers have ever been tasked with talking t payroll on this scale before...certainly not within teh timescales that have now been set!
Pension providers also deal with their clients on a one by one basis rather than a bureau basis whereby one entity runs all the affairs of hundreds of pensions (not teh case with payroll as some bureau's run hundreds if not thousands of companies payrolls). Pension providers have never built it because they have never needed it.
Suddenly they now need it and they are having to move the tens of thousands of existing clients they have held on systems created in eth 80's onto a platform that payroll has built in the 2000's.
Pension providers are light years behind not because they chose to pocket the profits, such as they were from 1% AMC stakeholders that largely nobody joined and that break even after about 13 years, but because they have been investing in other areas.
This needs to change now and there is no choice if they want to stay in this market....looks like I just discovered a choice for them!!
@SteveB ...
... exactly, so if they had pooled their resources in a joint venture they could have all benefited.
The problems though are government made by the worst piece of legislation ever.
Simple anser, pay pension contribution along side PAYE, ring fenced in a specific fund, if employee wants to make alternative arrangements and annual sum is transferred to their approved PPP at the end of the tax year, just like opting out SERPS used to work.#
Let us not forget however the self-employed - what happens to them, they have been so screwed by tax raids, costly red-tape and time wasting bureaucracy, not to mention having used up their life savings keeping the business going because the banks stopped lending that they have nothing left to invest in their pension!
Worst piece of legislation ever?
This has been hugely successful in Australia, Chile and Denmark.
Given our ageing population and the burden on the State and our antiquated State Pension system not sure we had an alternative.
Not sure I would trust the Government to ring fence 20 million+ pension funds.
Common data standards
..well hopefully this will all be resolved later this year and the run in to 2015 will be a lot smoother than transferring .csv files from payroll to pension provider and back again!
I understand (as Co Chair for the Friends of AE in Bristol) that great progress has already been made in joining the whole system up already!!
@ Matthew ...
... you miss the point. I am not saying there shouldn't be a need for compulsory pension provision, I am saying the legislation is drafted in the worst possible way.
I am totally behind the ethos, it is the cack handed back to front red tape filled abortion of a piece of legislation that is my problem, which had obviously been drfated by civil servant who have not be let out enough. Had they consulted with those at the sharp end a far better way of achieving the results would have been achieved without drowning small business in red tape and the dire threat of extotionate penalties..
For the record my view is thus;
Every employee should be auto enrolled regardless, except that any employer with all employee schemes in place equal to or better than the minimum standerd could be excepted.Contributions are paid to HMRC alongside PAYE, they are fowarded to a ring fenced pension pot a la NEST overseen, but not controlled, by the government.If employee has own scheme in place they can opt to have the contributions transferred at the end of each tax year, akin to the old opt-out on SERPS, or possibly even transferred monthly.If there is to be opt out, then employee notifies HMRC who inform employer via RTI to stop making deductions.
A simple single hub system, allowing small business to grow and drag us out of recession, instead of being mired in yet more red tape.
Ok I see what you mean.
I agree with point 1 whole heatedly. Point 2 would make no difference to the employer as far I could see. Contributions are paid to the provider alongside PAYE now. Point 3 would make it very expensive to administer and would push charges up on pension schemes at a time when costs are being forced down or the employer would suffer the cost burden. Point 4 is an excellent idea but surely they should inform the pension provider and not the employer as the employer is surely given even more work to do?