If someone told me they were taking 1% of your wages and investing it for you
If someone told me that in two years they would be increasing this to 5%
If they told me that I wouldn’t be seeing that money back for 30 years or more
and that they couldn’t tell me anything about who they’d chosen to manage your savings…
I wouldn’t put up with it.
If employers think that all there is to auto-enrolment is some fiddling about with payroll, they reckon without their staff. The money that is taken out of people’s wages is real money that could alternatively be spent on real things, like paying off credit cards, buying groceries , meeting HP demands.
At the moment people are taking a lot on trust. They are trusting their bosses to set things up properly . But people are a little more savvy than they used to be . Over 5m downloaded by themselves, the PPI forms that http://www.moneysavingexpert.com made available on the web.
Those forms were used against the people who mis-sold them PPI, implying it would all be worthwhile while setting up policies that were never likely to be much use.
Does this ring a bell? The capacity crunch is not just about 1.8m employers who have to choose and set up pensions, it’s about 7m or so members of staff who will have little or no say in what their employer sets up for them, but are likely to be knocking at the bosses door as soon as something went wrong.
Things do go wrong
Last week something went wrong. One of our master trusts went missing, it ran out of money and had to be saved by another master trust. Fortunately the lifeboat worked but 7000 people in the failing scheme should know they had a lucky escape and they’re kept dry by the good offices of another master trust that is a little more solvent.
Choosing a pension need not be hard, it need not be expensive and if you are an employer looking at auto-enrolment who has yet to choose a pension, or if you chose a pension and you’re not sure why, then it’s time you knew what you are doing.
There is no excuse for not caring about these things and employers who blindly choose a workplace pension for their staff are behaving like ostriches. Accountants and advisers who foist workplace pensions on employers without having done the due diligence on those pensions are taking a bet against their professional indemnity insurance and providers who allow their products to be set up without any care cannot be seen to be treating their customers fairly.
It really is time we addressed these issues at all levels.