Half of all smaller businesses are not prepared to pay a financial adviser for work around auto-enrolment (AE), according to a report released today.
The report, compiled by GfK NOP financial for The Pensions Regulator (TPR), found that 46% of medium, 48% of small and 51% of microemployers were not prepared to pay for advice.
However, 87% of large employers had either consulted or planned to consult with an external adviser.
Smaller businesses are defined in the report as those with between 5 and 250 employees.
These findings are despite the fact that 78% of advisers, who traditionally service smaller businesses, said they were planning to offer AE services to potential clients.
The 129 advisers questioned said they felt the main challenge for IFAs around AE was 'cost', with 73% saying that they felt clients would leave it until the last minute before seeking advice (73% of IFAs compared with 37% of the 100 pension consultants questioned).
The report said this may be a reflection of the different sizes of client the groups are are dealing with.
As found in autumn 2012, many IFAs anticipated AE would increase their business (51%).
Most financial advisers had already helped their clients around AE (69%), with 95% having some form of interaction with their clients on the subject.
The report also found that advisers were better qualified to guide employers through the pitfalls of the AE process.
It states: "When asked about the more detailed aspects of automatic enrolment, financial advisers displayed higher levels of awareness than other business advisers including HR professionals (17 were questioned), payroll administrators (60) and small / micro business advisers (100)."
All were aware of the changes in pensions law with almost all understanding the changes (96%).
Financial advisers said they found out about automatic enrolment from a wide range of sources. Press advertising remained the main source (40%), with colleagues being another key source (20%).
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