UK - The Pensions Regulator (TPR) is planning to issue a consultation on its enforcement strategy in relation to employer compliance with the 2012 pension reforms later this year.
Speaking at the Pensions Management Institute (PMI) spring conference 'Regenerating Pensions', Toby Christie, employer compliance regime (ECR) policy manager at TPR, said the main focus for TPR at the moment is to educate and enable employers to comply with the new rules.
However he warned the regime needs to be seen as "authoritative and willing to enforce when necessary", but admitted there is a balance required between the need to demonstrate TPR is fair when it takes enforcement action against employers who fail to comply with the rules, and providing support for employers that need help.
Christie said: "Where employers haven't registered with us, which is an indicator they haven't auto-enrolled, we will contact them to remind them and encourage them to comply, and this will be a chance to put things right. We do know inevitably some employers will fail to comply and where it is clear that an employer is wilfully ignoring their employment duties we will take enforcement action."
In the meantime he highlighted the focus is on education, including an updated website to make it more audience specific, and TPR will shortly be publishing a leaflet for employers followed by more detailed guidance and interactive tools in the autumn.
In the panel discussion Christie confirmed that the communication approach to small and 'micro' employers would be tested on a small group of these companies ahead of their scheduled auto-enrolment date to ensure communications are targeted correctly and to see if there is a need to amend the approach, such as the 12 month and three month reminder letters. (See earlier IPE article: TPR sharpens education focus ahead of 2012)
"At the moment we have very basic information on the website. We are working on much more detailed guidance for pension professionals and then interactive tools aimed at small to micros employers to help them understand the processes they need to go through. It will be a two-pronged approach and we expect it to go live in the autumn. Around the same time as that we will start to expose our enforcement approach, and will have a public consultation on our enforcement strategy," he said.
Meanwhile Helen Dean, managing director of scheme development at the Personal Accounts Delivery Authority (PADA), said that because the new NEST scheme is likely to have large numbers of employers, many of whom lack knowledge of pension saving, it is "absolutely critical that the scheme is easy to use, that the user interface - as it will be largely online - is simple, easy, intuitive, straightforward".
As the NEST scheme is in the process of being built, Dean said the user, member and employer are at the heart of this process. For example, as part of the procurement for the scheme administrator, PADA conducted user-testing of the user interface as part of the procurement. (See earlier IPE article: Tata confirmed as NEST admin provider)
"It is absolutely clear to us and to TCS, who are the scheme administrator, that we need a very simple, easily accessible scheme. And as we now start to build the scheme, we'll similarly be bringing in users, members and employers who could be wanting to use the scheme, and we will be testing it with them to find out what their issues are and how well they have interacted with it," said Dean.
This will be ahead of the "soft launch" of NEST in 2011 with a small number of volunteer employers, with PADA using this additional time to "refine and test the processes and systems in advance of the employer duties in 2012".