Auto Enrolment in 2015
What we will cover
• What is auto enrolment• Who are Johnson Fleming• Market developments• The regulator gets tough• The solution(s)• Next steps
Quick introduction
Partner with
Introducing Johnson Fleming
Customer service: Excellence comes as standard
Tried, tested & proven…..
• Combined pensions experience of 65 years
• Staged over 75,000 employees
• Completed over 700,000 assessments
• Sent over 126,000 auto-enrolment communications
When do I stage?
If you don't know your PAYE reference, it can be found on a P6/P9 coding notice or on your white payslip booklet P30BC.
If you don't pay your staff through a PAYE scheme, your staging date will be 1 April 2017.
Step 1: Enter your PAYE reference:
• Tip: An example of a PAYE reference is 913 / WZ5121A. In this example you'd enter '913' and 'WZ5121A'.Take care not to confuse numbers with letters; zero and the letter 'O' look very similar!
Step 2: Enter the words/digits displayed below and then select 'Show my staging date'
32 new employer responsibilities
1. Employer duties and defining the workforce
2. Getting ready3. Assessing the workforce
• Postponement• Transitional period for DB and
hybrid• Having completed the assessment
4. Pension schemes
5. Automatic enrolment process6. Opting in, joining and contractual
enrolment7. Opting out8. Safeguarding individuals9. Keeping records10. Information to workers11. 11. Automatic re-enrolment
Guidance
52separate guidance notes
Over 70 items to address before, at and after your staging date
On the Openwork adviser hub
Obligation – Who to enrol
Obligations – how much to contribute
Obligation – assessing the workforce
Month 1 Month 4Month 3Month 2 Month 5 Month 6
£WAGES
Basic Basic Basic Basic Basic Basic
£833
Obligation – assessing the workforce
Month 1 Month 4Month 3Month 2 Month 5 Month 6
£WAGES
Basic Basic Basic Basic Basic Basic
Obligation- enroll employees into a qualifying scheme
What about NEST?
• Does not fulfill employers obligations
• Charges
• Restrictions
• Investment
• Flexibility
• Government financed not endorsed
Qualifying Workplace Pension Scheme
Why are we doing this?
Meet Average Joe
He is 35 and intends to retire at 65
Earning national average earnings
£25,000 (assumes salary uplift 1.5%)
Due to auto-enrolment
Joe’s & his employer will contribute
£59,821.64Assumes 8% contributions for 30 years
…and with a bit of growth (3.5%)
£102,567
…and Joe works with 20 others
£2,000,000 +
You are not alone
2012 –2014/15
43,538
2015/16
152,900
2016/17
617,000
2017/18
533,00
The next 12 months
April - June October -
December
January – March 16
15,000
110,000
2016/17
617,000
The scale in perspective
1960-20142015 alone
The impact on your business
Administration
Distribution
Processes
Staffing
Infrastructure
The Pensions Regulator is flexing its muscles…
2437 investigations
58% contained breaches
A change of approach … you have been warned!
The Pensions Regulator is flexing its muscles…
£400 statutory notice……..
Now issued escalating fines from £50 - £10,000 PER DAY!
The cost of getting it wrong
£1,000’sAnd that’s without fines ……
Over 70 items to address before, at and after your staging date
The burden
TIME CAPABILITY RISK
What is your key driver?
Solution.‘become your clients lifeline’
Managed auto-enrolment service
What’s included:
• Project management• Data validation• Assessment & categorisation• Communications• Opt out & in• Update payroll & provider• Register• Audit and record keeping
Supported auto-enrolment service
What’s included:
• Project management• Data validation• Assessment & categorisation• Communications• Opt out & in• Partial record keeping• Audit
Initial set up
£1,075
Ongoing administrationMAESFrom £195+ vat per month
SAESFrom £ 2.00 + vatPer member per month
Not all are created equal…….
My accountant will do it for me
Auto enrolment
deliveryTechnology drivers Advisory drivers
Remember Joe
£59,821.64
Not every scheme is the same…..if you haven’t asked
Its not just for large funds
35%
Contribution options
Contributions for net salary
Contributions via salary sacrifice
Contributions from gross pay
Tax relief: non tax payer
£ 960 £960
20% Tax added automatically
(£6,720)
How can one size fits all be the right answer?
History has a habit of repeating itself
Pensions have long been judged by this process…and you are making a pension decision
www.pensionlawyer4u.com
3
If its not written down….
• What research was conducted?
• What options were considered?
• Which were discounted and why?
If its not written down….
• How the scheme fits the needs of the employer and workforce?
• Gives you all the info they need
• Allows you to sign up to each service
• Updated frequently
www.johnsonfleming.com/openwork-client
The user experience
• This pdf is on the right hand side of the client facing site
When should I start?
• No need to wait till staging!
• Secure the resource
• Spread the cost
Don’t delay - Speak to your adviser today
Staff pressure
In time, enough people who pay into the pensions (the staff) will start asking some questions about where their money is going.
Financial impact
Decisions will come under scrutiny including those who influenced them…
…and those who seek to empower employees to obtain restitution abound.
2
Questions?
Ladies and gentleman thank you for listening
THIS DOCUMENT IS CONFIDENTIAL and intended solely for the use of the individual to whom it is addressed or any other recipient expressly authorised by Johnson Fleming Limited, in writing or otherwise, to receive the same. If you are not the addressee or authorised recipient of this document, any disclosure, reproduction, copying, distribution, or other dissemination or use of this communication is strictly prohibited. Past performance is not a guide to the future. Potential for profit is accompanied by the possibility of loss. The value of investment funds and the income from them may go down as well as up and investors may not get back the original amount invested. The content of this presentation is for information purposes, it does not represent personal financial advice and is not recommendation that contributions to the Group Personal Pension Plan will meet all of your future financial requirements for retirement. If you have any doubts as to whether the content of this presentation meets your personal needs you should seek independent financial advice. Johnson Fleming has joined alliances with specialist business associates who are able to provide personal advice, at your request. These carefully selected business partners reserve the right to charge a fee for these services which would be agreed in advance before they undertake any work on your behalf. Johnson Fleming Group Limited is authorised as a Firm of Financial Advisers and our permitted business activity is advising and arranging life insurance, pensions, investments and general insurance contracts. Johnson Fleming Group Limited is authorised and regulated by the Financial Conduct Authority (FCA Register number 599255, see http://www.fca.org.uk/register for registration details) and registered in England and Wales No 06272390.
Johnson Fleming Limited (FCA 215110), Johnson Fleming Administration Services Limited (FCA 480883) and Johnson Fleming Services Limited (FCA 606750) are Appointed Representatives of Johnson Fleming Group Limited. Registered Office: Johnson Fleming Group Limited, Fleming House, Bromsgrove Enterprise Park, Bromsgrove B60 3AL. JFXXXXXX
Important information