Five Questions About: Auto-enrolment

 

Simon Read
Monday 01 October 2012 10:42 BST
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Auto-what? Is this some new type of car tax?

Nothing to do with cars. It's all about pensions.

Yawn! Will you wake me up when you've finished then?

Wake up now, this is important. From Monday a process will begin which will end up affecting around 11 million people.

Will we all be worse off?

Better off hopefully in the long-term. The Government is forcing all UK firms to automatically put their workers into pension schemes. Crucially that will mean firms offering workers cash contributions to their retirement savings plans as well as workers getting tax relief on their own contributions.

Why are they doing this now?

Because millions of people don't have any form of pension saving. The Government hopes that by forcing them to have to opt-out of a company scheme, most will simply stay in.

Will my company start doing this right away?

Not unless you work for one of Britain's five biggest employers. From Monday firms with 120,000 or more workers start auto-enrolment, with smaller companies starting up in regular stages. By May 2014 it will include companies with 90 staff, and all employers should have auto-enrolled staff by 2017.

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