Enquiry for BERR and DWP on the predicted administrative costs of additional payroll services to support personal account pensions

In December 2006 the Government announced proposals to promote private pension saving across UK workplaces. These proposals are explained in the Government’s White Paper, ‘Personal accounts: a new way to save’ . The proposed personal accounts system will operate from 2012 and will require all employers to enrol eligible employees into a qualifying workplace pension scheme. All employers will have to engage with pension reform, meaning that many micro-businesses will be expected to make employer contributions to a pension for the first time. However, employers with satisfactory arrangements already in place, or who would prefer to set up an alternative qualifying scheme will not be required to join the personal accounts scheme.CEEDR was asked to conduct a survey-based enquiry on behalf of BERR and DWP to estimate the administrative cost of calculating and collecting monthly contributions for personal accounts, for businesses which outsource their payroll. This research project was intended to form part of the evidence base used by the joint DWP/BERR working group tasked with estimating the administrative costs of the personal accounts reforms. [...]