Month: November 2016

The number of penalties and fines dealt out to companies who fail to meet their AE pension deadlines has soared.

15,073 compliance notices, ordering business owners to adhere to pension regulations were issued between July and September. That is almost 60% of the total since auto-enrolment began in 2012.

Fixed penalty fines of £400 were issued to 3,728 companies. Further escalating penalties of between £50 and £10,000 were handed down to 576 firms.

These are the most fines issued in any quarter. The Pensions Regulator says this is down to the larger number of companies reaching their auto-enrolment staging dates.

Lee French, Director of Corinthian Affinity Solutions Limited, commented: “One in five businesses are missing their staging date and risk being fined so it is really important that they take advice as soon as possible.”

“Auto-enrolment is only partially about pensions. It is mainly about administration, so it’s important to plan ahead and ensure the changes required are in place.”

The Pensions Regulator said excuses not being accepted as “reasonable” include illness, reminders not being received and making a mistake.

One example case was a ruling against the owner of an Essex-based recruitment consultancy who had fallen ill. A judge said it was her responsibility to delegate the pensions compliance work rather than miss her staging date by two years. This shows tPR is not listening to excuses so you really do need to consider it sooner rather than later.

How Corinthian can help

To date, the Corinthian Group of Companies has helped more than 500 companies meet their auto-enrolment duties. Over the next 12 months, hundreds of thousands of small businesses will reach their staging date to auto-enrol staff in a qualifying workplace pension scheme.

Contact our professional team today if this is something you need help with to avoid heavy fines.

Are you unprepared for auto-enrolment?

Almost two-thirds of accountancy firms say their clients are unprepared for auto-enrolment (AE). They also say the costs of meeting their new legal requirements at their staging dates have “significantly increased”.

61% practitioners questioned by Accountancy Age revealed their clients were “not very” or “not at all” prepared for AE.

Four in ten (39.4%) said their practice’s costs had “significantly increased”. Processing, staff and admin time, client preparation and providing advice were among the main reasons.

Over the next year, thousands of businesses will reach their staging date to AE staff in qualifying workplace pension schemes.

The survey also revealed that half the firms lack confidence in selecting a pensions provider for their clients. It also showed 72.3% of firms are worried about clients being fined by the Pensions Regulator.

How Corinthian can help

Lee French is a Director of Corinthian Affinity, part of the Corinthian Group. Corinthian enables accountants, payroll providers and other affinity groups to deliver an AE solution saving clients money, time and stress.

“We want to ensure small businesses don’t miss their staging date by making a complex process simple,” said Lee. “That is why we have created the Affinity solution especially for accountants, payroll providers, IFAs and other affinity groups. It will give them the tools they need to support their clients.

“One in five businesses are missing their staging date and risk being fined. This means it’s important for those of us who advise small and micro businesses to have simple, cost-effective solutions. This is the only way to deal with the tsunami of businesses facing staging dates until April 2018.”

To date, Corinthian Affinity has helped over 100 ‘affinity’ groups provide a simple AE solution for their smaller clients. It offers the Salvus Master Trust as its preferred pension provider. This trust has already achieved the Master Trust Assurance Framework (MAF) accreditation. This is the Pensions Regulator’s new standard. It has also received a five-star rating from Defaqto, the independent financial products’ researcher.

Master trusts are to be under legal scrutiny and targeted with new restrictions as laws on pension schemes are strengthened.

New legal powers to scrutinise these trusts had their first reading in the House of Lords this month.
Corinthian Group Managing Director Robert MacGregor said: “We welcome the Pensions Bill being passed in law”.

Corinthian’s preferred pension scheme, Salvus Master Trust, has already achieved the Master Trust Assurance Framework (MAF) accreditation, which is the Pensions Regulator’s new standard. And it has also received a five-star rating from Defaqto, the independent financial products’ researcher.

Five key criteria were included in The Pensions Bill:

• That “Fit and proper” people are involved in a master trust’s management
• The scheme must be financially sound
• It must have an “adequate continuity strategy”
• Appropriate systems and processes should exist for their governance
• And also for their administration

“It’s simply a consumer protection item,” said pensions minister Richard Harrington at the recent Pensions and Lifetime Savings Association’s Annual Conference in Liverpool. “We can’t have a system where some pension schemes are more regulated than others.”

The PLSA is also calling for a rigorous scrutiny process to ensure the criteria are being met. A new legal framework could greatly boost the reputation of master trusts. This reputation has been tarnished by how some have not adequately provided for their members. As the schemes have had less governance than other pension plans and low entry barriers, it meant anyone could set one up for a low capital cost.

This has meant the benefits of master trusts have sometimes been overlooked. These include offering employers the benefit of a governance function but with generally low operating costs as well as greater simplicity and expediency than a single employer scheme.

For more information please contact 020 3668 3999 or e-mail [email protected]