Consultation on the need for a basic automatic enrolment assessment tool

25 March 2015

The Pensions Regulator has launched a consultation on whether to provide a basic automatic enrolment assessment tool for employers who use HMRC’s Basic PAYE Tool.

While using payroll software is not an automatic enrolment requirement, the regulator’s experience indicates that using appropriate payroll software helps employers to comply.

However, this runs alongside research that indicates half of employers with fewer than nine staff would be unwilling to pay to upgrade their software for automatic enrolment. Employers who use BPT and advisers acting on their behalf have also demonstrated unwillingness to purchase or use free payroll software available in the market place.

The regulator is now seeking views, particularly from pension providers, payroll providers, business advisers, employer groups and users of HMRC’s BPT, on what support is available in the market place for employers who use BPT so that we can identify gaps and consider whether a basic assessment tool is necessary.

Along with considering the necessity of a basic tool, the consultation also asks respondents to consider the following.

• If respondents believe we should have a tool, what functions should it provide? It is important the functionality of a basic assessment tool strikes a balance between supporting BPT users while maintaining incentive for them to seek a better automatic enrolment solution from the market place.
• How would a basic assessment tool affect the market place?
• What more could be done to encourage BPT users to switch to a system that provides integrated support for their automatic enrolment?

The consultation will be open until 19 May 2015 and the regulator intends to publish its response in the summer.

CIPP comment The Policy Team will issue a survey shortly to gather member opinion.