The Government has proposed new threshold figures for the automatic enrolment earnings trigger and qualifying earnings band for new Workplace Pension requirements that are due to start this October.
The Department for Work and Pensions (DWP) confirmed that the proposed new figures have been brought inline with PAYE tax threshold and National Insurance (NI) limits as these are figures employers are used to dealing with. As a result, a draft Order is being laid before Parliament specifying that for 2012/13 the automatic enrolment earnings trigger is increased from £7,475 to £8,105, bringing it inline with PAYE tax threshold, and the lower and upper limits for qualifying earnings is set at £5,564 and £42,475, which align with the limits used for NI.

The new figures are the result of a consultation last year, in which the key message was the need to simplify the process.

The move comes just six months before the first companies are due to begin automatically-enrolling their eligible employees. On 1 October 2012, companies with 120,000 employees or more must automatically enrol all their eligible employees into a qualifying workplace pension scheme.

In November's Autumn Statement, the Chancellor announced a delay in implementing auto-enrolment for businesses with 249 employees or less and this January the new staging dates were confirmed:

· 50 to 249 - 1 April 2015
· 30 to 49 - 1 October 2015
· Fewer than 30 - 1 April 2017

Individual dates are still to be confirmed.

According to Mike Jenkins, business development manager at Welplan Pensions, keeping up-to-date with the ever-changing pension reforms is vital if companies are to meet their legal obligations at the right time.

He said: 'Automatic enrolment into a qualifying pension scheme is going to have a significant impact on businesses, especially those who do not currently operate such a scheme and have neither the money nor manpower to invest in keeping up-to-date with the numerous changes to ensure compliance with the mandatory scheme.

'Companies need to consider the time and money involved and decide if outsourcing is the cost-effective option for them. Doing nothing is not an option.'

The Government's scheme NEST (National Employment Savings Trust) is designed to assist those companies looking for a qualifying scheme. However, other qualifying schemes, either run in-house or by another provider, may better suit business needs.

Welplan Pension is the preferred pension supplier for the H&V Operative National Agreement and a company defined contributions (DC) pension scheme which takes care of auto-enrolment and re-enrolment, providing a company-wide pension scheme for operatives and clerical staff, and offering advice and support through a dedicated helpline, relieving clients of administrative burden.

'With just six months to go before auto-enrolment begins, now is the time to take action,' warnes Wellplan.

For more information on the Pension Reforms and to keep up-to-date with all future amendments, visit www.welplan.co.uk