Research shock- employers do care about the pensions they provide their staff

workplace pensions

“Selecting the right pension scheme for auto enrolment is important and has long term implications for employees. Taking time to review the options that are available in the market is sensible and planning ahead will help to keep stress levels to a minimum.” – Morten Nilsson – NOW Pensions

 

“Given the complexity of the pensions sector and the long-term commitment required to properly monitor the value of savings, most employees are not sufficiently knowledgeable or engaged in their work based pension to achieve good outcomes”  -OFT -Sept 2013

 

 

Here are the detailed findings of a survey commissioned by NOW and carried out by BDRC Continental of 450 employers with 250 or less employees

 

No. Employees
Total Sole trader 2-5 6-10 11-50 51-250
Employers surveyed 450 50 75 75 150 100
Employers in UK (000’s) 1721 375 674 351 257 64
I haven’t given it any thought yet 751 275 231 159 81 6
44% 73% 34% 45% 31% 10%
I intend to use my existing scheme provider 373 35 196 62 54 25
22% 9% 29% 18% 21% 40%
I intend to seek help from my accountant 242 19 120 55 41 7
14% 5% 18% 16% 16% 11%
I intend to seek help from an adviser 88 34 26 18 11
5% 5% 7% 7% 17%
I’m going to search the market and do the research myself 70 15 7 26 20 2
4% 4% 1% 7% 8% 4%
I’ve already made a decision and secured a scheme 33 2 1 21 9
2% * * 8% 14%
I intend to speak to my payroll provider 16 7 6 2 1
1% 1% 2% 1% 2%
I’ll ask for advice from my trade body 12 8 2 2
1% 1% 1% 1%
I’ll talk to my peers and seek recommendations (referral) 2 2
* 1%
Don’t know 134 32 70 11 18 2
8% 8% 10% 3% 7% 4%

 

What this tells us

A significant proportion (14%) intend to get help from their accountant and 5% are going to consult an IFA. A small proportion (4%) are going to search the market and do the research themselves. Only 2% have already made a decision and secured a scheme.

 

 

And here are what the same sample answered to the question “How important do you consider your choice of provider to be?

No. Employees
Total Sole trader 2-5 6-10 11-50 51-250
No of employees surveyed 450 50 75 75 150 100
Total number of employees in the UK 1721 375 674 351 257 64
Very important 420 100 134 78 76 32
24% 27% 20% 22% 30% 50%
Important 567 53 226 178 87 23
33% 14% 33% 51% 34% 36%
Neither important nor 226 46 100 36 41 3
unimportant 13% 12% 15% 10% 16% 5%
Not important 137 33 66 17 19 3
8% 9% 10% 5% 7% 4%
Don’t know / haven’t thought 371 143 149 42 34 3
about it 22% 38% 22% 12% 13% 4%

 

What this tells us

 

Four in ten (44%) small and medium sized companies haven’t given any thought to how they’ll go about finding a pension scheme to comply with the new auto enrolment legislation.

 

Despite a large proportion of SMEs admitting they are yet to think about their pension scheme, over half (57%) of firms surveyed think that their choice of pension provider is either important (33%) or very important (24%). Only 8% think it is unimportant

 

This is what these employees responded to the question “Do you think offering a good quality pension provides an opportunity to improve a) employee retention, and b) the attractiveness of the company to your employees

 

No. Employees
Total Sole trader 2-5 6-10 11-50 51-250
Total in the survey 450 50 75 75 150 100
Total number of companies in the UK (000s) 1721 375 674 351 257 64
Yes, I think it will help with employee retention 693 97 301 162 95   38
40% 26% 45% 46% 37% 60%
Yes, I think it will help to improve the attractiveness of the company to potential employees 553 75 187 165 92   34
32% 20% 28% 47% 36% 53%
Not sure 867 243 345 125 132 22
50% 65% 51% 36% 51% 34%

 

What this tells us

 

Four in ten (40%) believe offering a good quality pension scheme will help with employee retention and nearly a third (32%) think it will help to improve the attractiveness of their company to potential employees.

 

The Pension PlayPen is the only website in the UK dedicated to helping SME’s select workplace pensions. Our principal users are Accountant, Advisers, and employers direct. Within the latter category we see purchasers within employers coming from Finance, HR and Payroll. For very small employers , the principal purchased is taken to be the MD/Founder.

 

About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in accountants, advice gap, Payroll, pension playpen and tagged , , , , , , , , , , . Bookmark the permalink.

1 Response to Research shock- employers do care about the pensions they provide their staff

  1. Pingback: Why employers cannot be “provider agnostic” about their workplace pension. | The Vision of the Pension Plowman

Leave a Reply