Firms could be neglecting staff retirement needs by concentrating solely on compliance, a specialist has warned.
Head of the fit age programme at Towers Watson, Phil Percival said “industry changes from the last decade such as annual allowances, auto-enrolment, ending contracting out and the flexibilities introduced in April, had caused firms to prioritise compliance over other issues”.
He added: “Such a flurry of change is preventing companies from focusing on the real reason for providing pension plans – either for the employer, in terms of attraction and retention, or for the employee in terms of their ability to retire.”
Towers Watson researched about a 100 companies and the results found that when they asked employers to select the most important issue driving their defined contribution pension plan provision, compliance to the legislation came first.
Issues such as employees’ ability to have a healthy retirement plot were not so important and competitiveness with other businesses, cost, and use of pensions as an attraction or retention were paramount.
Ontime believes that Auto enrolment is about giving workers what they deserve, a financially secure future and a present peace of mind that they will have a healthy retirement.