MPs launch auto-enrolment inquiry

November 19, 2015 | posted in

Government spending watchdog the Public Accounts Committee (PAC) has started an investigation into auto-enrolment, focusing on the risks of smaller firms enrolling and whether the process increases retirement income.

In September, the PAC said it would investigate auto-enrolment before the end of the year.

It has now launched an inquiry following the publication of a national audit office (NAO) report into the policy.

The PAC inquiry will look at two of the main issues raised by the NAO report: the risk posed by smaller businesses signing up to the policy, and how the Department of Work and Pensions (DWP) can ensure auto-enrolment increases retirement incomes.

The NAO report found auto-enrolment had so far been delivered on track at a lower than expected cost. It originally expected the policy to cost £1.1 billion, but this has now been reduced to £1 billion.

However, it said the policy would be tested as smaller businesses reached their staging date because it would increase the pressure on the Pensions Regulator and the government-backed auto-enrolment scheme National Employment Savings Trust (Nest).

It also said the DWP needed to be monitored in order to ensure the policy increased income in retirement.

An online announcement said the inquiry would look at those concerns raised by the NAO report.

‘This inquiry looks at the risks of registering smaller employers and how DWP ensures that more widespread enrolment translates into higher retirement incomes,’ it said,

 

Article by By Charles Walmsley 09 Nov, 2015- New Model Advisor