JLT calls for auto-enrolment thresholds to support administrative

 simplicity and enhance the success of auto-enrolment

3rd February 2012, London:  In response to the Automatic Enrolment Earnings Thresholds Review & Revision Consultation, JLT Benefit Solutions Limited (JLT) believes the focus needs to be on a solution which supports the practical administration of auto-enrolment for employers and thereby enhancing the chance of success of auto-enrolment.

Mark Pemberthy, Director, JLT, says, "Administration of auto-enrolment will already be a challenge for the majority of employers. Aligning auto-enrolment thresholds with tax or National Insurance thresholds will enable employers to extract relevant data from their payroll systems more easily and therefore have a positive overall impact on auto-enrolment administration and remove a potential barrier to the success of auto-enrolment.

"JLT believe that some formality should be given to this alignment by confirming that the link will hold for a period of 5 years to support administration simplicity for employers whilst allowing Government longer term flexibility to be able to adjust thresholds in line with policy aims during the term of a Parliament. Implicit in JLT's recommendation is linking of the upper limit of the contribution band to the upper earnings limit."

JLT would argue that the benefits of linking to a figure already in use outweigh the potential additional costs to employers. In particular:

• individuals with earnings around the upper earnings limit are more likely to already be covered by a workplace pension and that arrangement is unlikely to be operating on a band of or capped earnings;
• short term impact on employers is reduced as contributions are now being phased in up to 2018; and
• it will improve retirement outcomes for some individuals.

Mark Pemberthy concludes, "We strongly recommend that legislation be changed to provide that all automatic enrolment figures be linked to tax and NIC thresholds. Our recommendations promote simplicity of operation for employers by utilising recognisable figures which will benefit payroll system compatibility and support the practical administration of auto-enrolment."

--ENDS--

 

Enquiries:

JLT Group Corporate Communications                   JLT Benefit Solutions

Isabella Young                                          Simon Hazeldine

Email                                                    Email

+44 (0)20 7558 3387                                   +44 (0)1727 775 102

 

Editor's Notes:

About JLT Benefit Solutions Limited

JLT Benefit Solutions Limited (JLT) is one of the UK's leading employee benefit providers offering a wide range of benefit and pension services, including administration, actuarial and pension consultancy, investment, Self Invested Personal Pensions (SIPPs), Small Self Administered Schemes (SSASs) flexible benefits, healthcare, benefit communication and financial education.

Authorised and regulated by the Financial Services Authority, JLT employs over 1,300 professionals in the UK with revenues of some £132m in 2010. The acquisitions of HSBC Actuaries and Consultants Limited and iimia Wealth Management have supported JLT's continued expansion to become one of the four largest employee benefits consultancies in the UK. JLT was awarded Pension Scheme Administrator of the Year at the 2010 European Pensions Awards and won the Engaged Investor's Most Innovative Pension Consultancy Award in July 2011

Other pensions and employee benefits companies within the JLT group of companies include: JLT Wealth Management, JLT Investment Management, Profund Solutions Limited, Independent Trustee Services Limited and JLT Pension Capital Strategies Limited.

JLT Benefit Solutions Ltd is part of Jardine Lloyd Thompson Group plc.

http://www.jltgroup.com/employee-benefits/

Jardine Lloyd Thompson Group plc

Jardine Lloyd Thompson Group plc (JLT) is an international group of risk specialists and employee benefits consultants and one of the largest companies of its type in the world. JLT offers a distinctive choice to clients and partners through our combination of independence, scale and specialism.

The Jardine Lloyd Thompson group is quoted on the London Stock Exchange and employs over 6500 people worldwide and through the JLT International Network provides services in more than 130 countries.

http://www.jltgroup.com/