In the spring of this year, The Pensions Regulator (TPR) asked more than 130 accountants dozens of questions about automatic enrolment. Their answers help us to understand what the market place is doing, what it plans to do and, crucially for my colleagues and me, what we at the regulator can do to help, says Neil Esslemont of TPR.
We carry out similar research every six months with hundreds of different types of business advisers. For the past two years, we have examined their awareness, understanding and activities both current and planned.
We believe that around a quarter of employers becoming subject to the new duties in late 2015 and early 2016 could turn to their accountant for help. This means that accountants will have tens of thousands of small and micro employers - existing clients - seeking support in meeting their automatic enrolment duties.
You can see the full results of the latest research on The Pensions Regulator website.
Accountants and pensions
There’s been some discussion on AccountingWEB around the role accountants might play in helping their clients select a pension be that for a workforce of three or for 63 workers.
Advising employers on scheme selection is not in itself regulated activity, although there could be a risk of straying into the regulated advice space if the individual representing the employer is, or will be, a pension scheme member, as they could be investing their own money into the pension scheme. We do know, though, that accountants will be asked about scheme selection and your clients will expect some information.
We recommend accountants stick to fact-based communications on this matter, but this does not mean they cannot assist clients. To assist accountants, in the summer of last year TPR published ‘A quick guide to pensions scheme selection and automatic enrolment’.
The guide highlighted the kind of assistance all accountants might offer clients, “you should be able to direct employers to sources of information, guidance and advice to help them select a good quality scheme.” The guide provides questions that employers should ask when assessing a pension scheme, as well as background to why these issues are important, and is available on our website.
Almost half of the accountants we surveyed intended to partner with other advisers to offer automatic enrolment services to their clients. These professionals were most likely to be financial advisers, IFAs or brokers. It looks like many accountants are choosing to signpost their clients to a regulated adviser when it comes to scheme choice.
The regulator is here to help too. We already have a wealth of information on scheme choice aimed at advisers and at employers. We are listening to the discussions taking place among the legions of accountants still considering how to respond to automatic enrolment.
It is a dynamic environment. At the moment we are refreshing our communication products, the website, guides and tools we provide to ensure it meets the ever changing audience. Two years ago, we were talking to the UK’s biggest employers, last year to medium employers and their advisers and now a new audience of small and micros employers is on the horizon.
A core message has remained throughout, that employers need to allow time to prepare for automatic enrolment. Accountants too need to take time to consider the impact on their business, both the challenge and potential.
We would suggest that accountants find out when their clients’ duties start (their staging dates) and plan accordingly. You can look up the staging date of an employer on our website, if you have their PAYE references - and you can also look at our handy planning tool which shows the tasks an employer will need to do to get ready and gives a timeline.
We also regularly publish new information and updates which advisers (e.g. IFAs and accountants) find useful, including holding live webinars.
Anyone interested in receiving regular updates should subscribe to our ‘News by Email’.
Neil Esslemont is the head of The Pensions Regulator’s industry liaison team. TPR’s latest AE webinar is planned for 28 October.
AccountingWEB has launched the No-one gets left behind campaign to alert as many accountants as possible to the obligations implied by auto enrolment. Read our simple eight-point statement which sets out the auto enrolment facts you need to know.