Pensions

[BAJR Host]

Just pondering this one....

The LAW
Q Will my employer make a contribution to my plan?
A Not necessarily. They are not obliged to do so.

IFA -
6% employer pension contribution subject to any reasonable qualifying period - There is no requirement within the amended scheme for employers to compensate staff who choose not to join a pension scheme where employer contributions are offered.

Any employer not adhering to this package is expected to remunerate their staff as follows.

No employer pension contributions (+6%)
PIFA
+?851.82pa
AIFA
+?992.16pa
MIFA
+?1284.72pa

But if an employee refuses to join a scheme, for whatever reason, that has been offered by the company, the company is not obliged to remunerate.. :face-thinks:

So.... if I get this right... You (as an employer) must by law offer at least a Stakeholder Scheme if you haev more than 5 employees.. however, you don't have to accept it (as an employee) if you don't want to, and the employer is then not obliged to remunerate you... So how come the IFA Employment package has an expectation on RAOs to provide pension, has a calculation of 6% remuneration if they don't .. but also says you don't have to remunerate...

Pensions... I am just confused ... not knocking anyone... jsut want someone to explain this to me... B)






"No job worth doing was ever done on time or under budget.."
Khufu

[oldgirl]

I could be completely wrong on this one (in fact you probably know better than I do as you've been on council recently!) , but I think the IFA calculation was an attempt to take into account in the RAO payline guidance the fact that some people have other benefits in their overall package, and some don'e. That is, rather than just looking at pay, that other benefits (such as a pension) could be looked at in an overall package.

But why not ask them directly?

[BAJR Host]

Its not so much about the IFA.. more about pensions and contributions and requirements in law... who has to pay what to who, and do they have to pay what to who if who does not want the other who to contribute... etc....

THe IFA package, which I looked at, is one try at explaining it... but I am still confused. In the IFA case, the only difference from law seems to be the 6%..

"No job worth doing was ever done on time or under budget.."
Khufu

[oldgirl]

I think, in that case, it might be worth talking to another type of IFA, an Independent Financial Advisor. Or the HMRC if you have a helpful local tax office! [hm]

I know it confuses me completely and I am just glad I'm no longer an employer!

[BAJR Host]

"No job worth doing was ever done on time or under budget.."
Khufu

[oldgirl]

There appears to be a new bill going through parliament about occupational pensions. Initial information about it is at : http://www.thepensionservice.gov.uk/pens...counts.asp with more information promised on the DWP website.

It says :

" Minimum employer contribution
There will be a duty on employers to provide a workplace pension scheme or a personal account for their employees, and also to contribute a minimum of 3% (on a band of earnings) to employee?s pensions. This will sit alongside 4% from the employee (on the same band of earnings) and around 1% from the Government in the form of tax relief."

Thus, if people opt out of the workplace options, they have an alternative of the 'personal account'.

I would guess that the IFA 6% is part of the attempt to persuade RAOs (who are the organisations they have more direct influence over) to go above and beyond the bare minimum with their staff, in order to improve the benefits and pay for the profession as a whole.

[BAJR Host]

I did however find out that an empoyer, after offering a pension scheme, and the employee says.. " no thanks" the employer (even an RAO) is not required to provide any remuneration.

"No job worth doing was ever done on time or under budget.."
Khufu

[oldgirl]

Which is presumably down to the law of the land. Which is hopefully being covered by the options described in the link I put in above. As far as I can tell, you can opt out of even the personal accounts, but the default position is 'opt in'.

[Unitof1]

I have a D?j? vu feeling of D?j? vu.

In what way do you relate to this topic or me