Headstart: Pensions – Shed light on pensions.

If you are unaware of the impending introduction of stakeholder pensions you can at least draw comfort from the fact that you are not alone in your ignorance.

In contrast to the Barclays’ survey (page 23), a recent study produced by Scottish Amicable showed that almost half of the UK’s small businesses have never heard of stakeholder pensions.

And if that was not surprising enough, the survey threw up other interesting conclusions.

Only 20% of companies said they would have a stakeholder scheme in place by 8 October this year, the deadline for when employers must offer a pension to staff or face a potential fine of £50,000.

Less than 20% of the 1,000 businesses questioned have only just started reviewing their pension arrangements in the light of the imminent changes and almost half claimed they had no intention of doing so.

In all, it is a less than impressive response to changes that John Glendinning, director of pensions development at Scottish Amicable, calls the ‘most radical in a generation’.

‘We were surprised,’ he says. ‘We expected to find a lack of awareness but it is more extreme than we realised.’

Many of these businesses, in mitigation, said they believed they would be exempted from the new rules.

Exemptions include those for companies that employ fewer than five people or occupational pension schemes being offered to all staff within a year of joining work.

One of the reasons why many firms have so far failed to respond is that businesses, especially those outside the financial sector, might not realise stakeholder pensions are just about to be launched.

Ministers launched, at the beginning of this year, an advertising campaign to try and readdress even though they must know it is a hard task to get many interested in the complex world of pension provision.

Who then could feel this breach and provide businesses with a greater awareness of the brave new world of stakeholder pensions? Glendinning points to financial experts such as accountants as being key to providing more information.

‘What you would probably expect to happen now is increased activity from intermediaries including accountants. Accountants are certainly in a good position to influence what the employer does,’ he says.

‘They will be able to provide a level of expertise and a degree of information that businesses otherwise would not find,’ says Glendinning.

Scottish Amicable is considering carrying out more research on business preparedness ahead of the starting point in April for when contributions can begin being paid into this new type of pension.

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