Auto-enrolment into pension schemes is expected to begin in October 2012, the Personal Accounts Delivery Authority (PADA) revealed today.
In a document published today, PADA says: "The personal accounts scheme will need to be fully operational in time for the onset of the employer duties. Our working assumption is that this will be in October 2012."
This is the first time a precise date for the scheme has been suggested, with all previous announcements stating auto-enrolment would begin at some time in 2012.
"The Government cannot introduce the employer duty until there is something for companies without their own pension schemes to auto-enrol people into," explains Watson Wyatt's senior consultant, Paul Macro.
"It may be that PADA does not think it can get personal accounts up and running until late in 2012."
However, the date was buried on page 26 of the personal accounts scheme supplier prospectus, and Macro is surprised PADA has not made a formal announcement.
"The date when the new rules kick in will affect every employer in the country, not just suppliers to the personal accounts scheme," he adds.
Watson Wyatt says the late start date should give employers valuable time to implement the changes outlined in the Pensions Act 2008, but says firms should begin working towards auto-enrolment now to ensure they are ready for October 2012.
In response, PADA says: "Any announcement on the onset of employer duties is a matter for the DWP and not for PADA to make.
"The working assumption of October 2012 has been reached by DWP taking account of the duration of the procurement processes required for both the personal accounts scheme and the compliance regime, the allocation of those contracts, and ensuring that the required systems are in place to ensure a smooth implementation of the programme."
Contact: John Bakie, Tel: 020 7484 9805, e-mail: [email protected]IFAonline
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