A majority of small to medium-sized enterprises (SMEs) are concerned about the potential financial implications of government plans to overhaul pension provisions, a new survey has indicated.
Research conducted by the Association of Consulting Actuaries (ACA) found that 53 per cent of the 404 SMEs polled believed the reforms will "significantly add to costs", while 29 per cent said they may cut pension contributions as a result.
"The cost of pensions to both employees and employers is the big issue that has prevented the extension of pension provision to date in the sector," said ACA chairman Stuart Southall.
Under the new legislation, businesses will be obliged to automatically enrol employees on to pension schemes, although individual employees will have the choice to opt-out – which 35 per cent of those quizzed by the ACA expect them to do.
The group's findings follow a study from Mercer, which revealed that 86 per cent of businesses are yet to check whether their pension plans are compliant with the new rules.
Posted by Ross George