Charity Finance Group urges charities to prepare early for auto-enrolment on launch of new guide

13th November 2013

CFG is concerned that 22,000 small charities that are due to auto-enrol their employees into pension schemes from 2015 onwards could be underestimating the scale of the task. Findings from a recent CFG survey show relatively high levels of confidence in the sector, with 63% of respondents due to auto-enrol from 2015 saying they are confident in their capacity to implement it. However, this appears to be at odds with the practical experience of those who have complied to-date.

Caron Bradshaw, CEO of CFG said: “Auto enrolment is a huge undertaking for employers particularly those with low pension take up already; the additional cost of the scheme and administration complexity will be major challenges. Ultimately, evidence shows it’s vital that charities start thinking about auto-enrolment at least 9-12 months in advance. The lessons from some of the largest charities that have already gone through the process are clear; plan early and factor in cost, check with your current pension provider well in advance if planning to use them and anticipate low-opt out rates. We have particular concerns about the capacity of small charities to comply, and the level of support that will be available to them at that point.”

A new ‘how-to’ guide on auto-enrolment

To support the sector CFG, have launched a good practice guide: ‘Auto-enrolment for charities: a how-to guide’. The new publication signposts to the relevant advice from the Pensions Regulator, setting out the key steps employers need to take, along with a series of demonstrative case studies on the experiences of charities, all in an accessible, easy-to-read format. Caron continued: “We hope that this practical guide will finally provide charities with a clear outlook on their responsibilities and on how to approach this complex issue.”


The guide was developed with support of CFG members and in collaboration with Foster Denovo, Premier Pensions, and Stephenson Harwood, and is available for charities to download for free from CFG’s website.

Ian Bird, Equity Partner at Foster Denovo, highlighted: “Auto-enrolment remains one of the biggest challenges for many charities, at a time when their budgets and resources are already stretched. In my experience, early preparation and budgeting combined with getting key stakeholders within the organisation – HR, Finance and Administration teams, trustees, financial advisers, pension and payroll providers – involved and engaged from the start is critical to successful auto-enrolment.”

Philip Goodchild highlighted the risk of non-compliance: “We know that compliance with the law is a concern for many charities. Non-compliance could potentially result in a hefty fine.”

Martin Thompson from Premier Pensions stressed the need to check whether your current provider will accept auto-enrolment: “Some charities are assuming that their current provider will automatically accept auto-enrolled employees. However, this may not be the case. Our advice is to check and make sure you are getting good value for money for members through low charges.”


- Ends -

Notes to Editors:

 
1. CFG is the charity that champions best practice in finance management in the voluntary sector. Our training and development programmes enable finance managers to give the essential leadership on finance strategy and management that their charities need. With more than 2000 members, managing over £19bn, we are uniquely placed to challenge regulation which threatens the effective use of charity funds. For more information, please see www.cfg.org.uk

2. An estimated 22,000 charities, employing less than 30 staff, are due to auto-enrol from 2015 onward. 215 of the largest charities will have staged by the end of 2013, with close to 4,000 having done so by end of 2014.

3. The guide, available for charities to download from CFGs website, was developed in collaboration with Foster Denovo, Premier Pensions, and Stephenson Harwood.

4. Foster Denovo is a national financial advisory firm who provide a range of financial services to individuals, corporate and charitable organisations including Mortgages and Protection, Investments, Financial Planning, Insurance and Pensions and Employee Benefits. Foster Denovo is proud to have been awarded Money Marketing’s ‘IFA of the Year 2013’.

5. Premier Pensions dedicated Charities Team comprising pension experts, actuaries and financial advisers have in-depth knowledge of the issues facing the sector. We provide an active commentary on new legislation and issues affecting not for profit organisations

6. Stephenson Harwood has provided specialist pensions legal advice to not-for-profit and corporate organisations and trustees for over 30 years and is acknowledged in Legal 500 and Chambers & Partners as a leading pensions law firm. It comprises 110 partners and over 600 staff and has specialists capable of dealing with virtually every commercial issue affecting any organisation. The Stephenson Harwood pensions team is one of the larger city based pensions teams.

7. For further information, please contact Jane Tully, head of policy and public affairs, CFG at jane.tully@cfg.org.uk or on 0207 8715474.

  • Email
  • Twitter
  • Facebook
  • Linkedin

© Charity Finance Group / © Charities Resource Network / Registered Office: 15-18 White Lion Street, London, N1 9PG.
A Company Limited by Guarantee. Registered in England No. 3182826, Registered Charity No. 1054914, Registered VAT No. 945 6038 09.