Commenting on the changes to auto-enrolment announced today by Pensions Minister, Steve Webb MP, John Longworth, Director General of the British Chambers of Commerce, said:
“Pensions auto-enrolment imposes huge costs on business, with the government’s own estimates suggesting it will cost employers over £4.5bn per year. In the current climate, a delay to auto-enrolment for small businesses with fewer than 50 employees is good news.
“However, the changes proposed today will bring new uncertainty to all firms with fewer than 3,000 employees. The vast majority of employers in the UK will be left in a state of confusion. The government must urgently work to deliver certainty to affected companies, and immediately clarify when this latest policy shift will affect them.
“Since smaller businesses will now not be required to auto-enrol their staff in pension schemes until the next Parliament at the earliest, the government has an important window of opportunity to pare back the costs they face when they do join the system.
“In a recent BCC survey, a third of sole traders said than pension requirements were a total or significant barrier to taking on their first staff member. Exempting sole traders from pensions auto-enrolment when they take on their first employees would remove a significant barrier for those business owners looking to expand their business.”