My object all sublime
The stated purpose of auto-enrolment is to include 11m people currently excluded from pensions savings in good quality workplace pension schemes so they can receive more from the pensions system than their state pension entitlement.
I shall achieve in time
Rather than introduce auto-enrolment all at once, it is being introduced over time, allowing smaller companies more time to get ready to meet their new obligations to staff
To let the punishment fit the crime
If these obligations are laid down in law, not meeting them should be regarded as punishable. The Regulator has the right (not yet exercised) to impose severe fines on employers which flout the law.
But is fining a company the best answer. Will the money flow into the Regulator’s Christmas party fund (bonus’ and mince pies all round)? It might as well for all most employers know.
That punishment doesn’t fit the crime, after all the victims of non payment of auto-enrolment contributions are the company’s staff (the Human Resource as they are lovingly known). This is not a victimless crime, the victims are known and any fine should recompense the victims and not be paid into some amorphous fine-box in Brighton.
The punishment fit the crime
My extremely learned friend Mr Jonathan Reynolds picked up on this point and tweeted with some brevity
And make each prisoner pent
I propose that for each month he employer was late with their staging, they pay a month’s worth of contributions.
A cause of Innocent merriment
It will be slightly embarrassing for employers to have to pay employee contributions and explain they are doing this as punishment for not getting it right first time.
Of innocent merriment!
Imaginative regulation need not be as ridiculous as Pooh-Bah’s in the Mikado. I have some sympathy for small employers who get auto-enrolment but only “some”. The bottom line is that the employee in Mrs Wiggin’s tea-shop is every bit deserving of a proper pension as she would be if she works at the Tesco check-out. We can’t have carve-outs for small employers without even more complexity ( a small employer’s national insurance rate anyone?).
Jonathan Reynold’s idea is not ridiculous- in fact it’s very good. As I am going to be in the same Gherkin as @stevewebb1 tomorrow afternoon, I might bring this up with him after his talk to the Friends of Auto-Enrolment.
This article first appeared in http://www.penionplaypen.com