28 Feb 2008 - Voluntary Sector Forum
The future of pensions in this country is set to be shaken up in a few years time and will have repercussions on organisations large and small - including many in the voluntary sector.
This was the message from Paul Coward and Gary Bradley of the Pensions Trust at a meeting of the Voluntary Sector Forum held at Waitrose in Rickmansworth.
The government is pushing for more people to save for their future and retirement. A major part of this will be the introduction of new Personal Accounts for every employee from 2012. These Personal Accounts (or pensions) are aimed at the 7 million people who do not have a private pension and have not taken up the Stakeholder pensions.
Even organisations with just one paid employee - like many charities - will be obligated to offer this new pension to staff. At present employer's obligations to offer pensions begin when they have five or more staff. Employers who have a scheme which is at least as good as the Personal Accounts (ie the employer contributes at least 3%) will be exempt from providing Personal Accounts. However they will be required to automatically enrol all relevant staff into their own scheme.
While individuals will have the right to opt out of the new system they will automatically be re-enrolled every three years and will subsequently have to opt out again, if they wish. The fine details of this new system have still to be worked out and employers large and small will have to keep an eye on the situation as it develops.
One of the greatest repercussions for the voluntary sector will be budgeting realistically to ensure that they can cover the cost of the 3% employer contribution.
This will represent an extra cost which may be completely unbudgeted for – especially for small organisations. Planning to cover this will have to begin sooner rather than later.
Those attending were able to ask numerous questions and found the presentation by Paul and Gary of the Pensions Trust very useful. The Pensions Trust is a not-for-profit organisation which specialises in offering pensions to the voluntary sector.
* The CVS in Three Rivers would like to thank Waitrose management for kindly offering us free use of their staff training room for this meeting and supplying us with refreshments.