The coalition Government has announced that it will be reviewing the implementation of automatic enrolment into workplace pensions.

This is a significant development for the industry and comes after months of REC lobbying to highlight the practical and cost issues that auto-enrolment raises for providers of temporary and contract staff.

Announcing the review earlier today, the Minister of State for Pensions, Steve Webb said:

“The Coalition Agreement confirms our intention to introduce automatic enrolment, which evidence shows is an effective means of increasing pension saving. However, circumstances have changed since the Pensions Commission published its recommendations in 2005. It is right that we consider whether the approach inherited from the previous Administration strikes the right balance between cost and benefits to individuals, employers and for the tax-payer.”

Commenting on this latest development and on the next steps for influencing the debate, Anne Fairweather, the REC’s Head of Public Policy, says:

“This is a big win and provides us with a great opportunity to argue our case for a more flexible implementation of auto-enrolment measures. The scheme would be of limited value to those completing a series of short-term assignments but would risk creating a huge amount of bureaucracy for agencies. We are calling for a common-sense approach and for the specific nature of agency work to be recognised and factored in.”

The review will be conducted by an independent team, led by Paul Johnson, Frontier Economics; David Yeandle OBE, Engineering Employers Federation and Adrian Boulding, Legal and General Group PLC.