Pension problems for small businesses
The government's planned state pension scheme is too complex and over-reliant on means testing, according to the Association of Consulting Actuaries (ACA).
A survey by the ACA found that many small companies, employing 250 or fewer employees, are lowering rather than increasing expenditure because of time management and cost concerns.
Many small firms seem to be reducing defined benefit coverage and levelling–down to lower cost defined contribution schemes.
"The survey has found many small firms are valiantly struggling to offer pension arrangements in the face of changes that have added greatly to costs in recent years," commented Ian Farr, chairman of the ACA.
Nearly two-thirds of companies think that the state pension reforms proposed by the Pensions Commission are too complex and will not create a clear understandable base upon which private savings can be built.
Over 40 per cent of small firms have reviewed their pension arrangements in the last year and 23 per cent expect to review in the year ahead.
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