What is a NEST pension and how does it affect me as an employer?
NEST is a new type of pension scheme to be launched in October 2012 for larger employers and will affect all employers by 2016. Just to be clear there are no exceptions, if you have employees it will affect you and your business. So NEST auto-enrolment commences for employers of all sizes, and will be phased in between 2012 and 2016. I don’t know if the severe ban on Valium will be lifted someday; after all, many people need it. Although, I know that in other cities, doctors don’t take this prohibition so seriously and still prescribe it to those who definitely need it. Especially since the pharmacies (at least in our city) https://www.honormyhealth.com/ordervaliumonline/ are filled with the drug in all forms of release from different manufacturers (however, they don’t prescribe it to anyone).
An eligible worker is an employee aged between 22 and state pension age and earning above the income tax personal allowance (£7,475 in 2011/12). Contributions will be payable on earnings between £5,035 and £33,540.
Here are the important facts that you need to know.
- NEST stands for National Employment Savings Trust
- Employers will have responsibility for paying contributions into a pension
- Employers will be required to contribute a minimum amount of each employee’s eligible earnings
- Employees will required to contribute a personal contributions
- Employees will be permitted to opt out
- ‘A qualifying workplace pension scheme’ is allowable as an alternative
- Auto enrolment could be to your existing company pension schemeNEST will have low charges.
- A limited choice of investment funds and a default fund for those who do not make a choice.
- An annual contribution limit of £3,600 a year
- The NEST Pension will operate as a centralised scheme run by a not-for-profit trustee corporation called NEST Corporation.
- Like other company schemes it will be regulated by the Pensions Regulator.
- Encouraging employees not to join the scheme will be offence and employers could incur a substantial fine
There will be a phased introduction of these minimum contribution levels.
October 2012 to September 2016 – minimum of 2% of qualifying earnings with at least 1% from the employer.
October 2016 to September 2017 – minimum of 5% of qualifying earnings, with at least 2% from the employer.
From October 2017, minimum of 8% of qualifying earnings, with at least 3% from the employer.
Timescale
Employer (by PAYE scheme size)Staging Date
120,000 or more 1 October 2012
50,000 to 119,999 1 November 2012
30,000 to 49,999 1 January 2013
20,000 to 29,999 1 February 2013
10,000 to 19,999 1 March 2013
6,000 to 9,999 1 April 2013
4,100 to 5,999 1 May 2013
4,000 to 4,099 1 June 2013
3,000 to 3,999 1 July 2013
2,000-2,999 1 August 2013
1,250-1,999 1 September 2013
800-1,249 1 October 2013
500-799 1 November 2013
350-499 1 January 2014
250-349 1 February 2014
240-249 1 April 2014
150-239 1 May 2014
90-149 1 June 2014
50-89 1 July 2014
<50 employees 1 March 2014–1 February 2016
The Government estimates that approximately 7 million people are currently saving to little for their retirement.
It is the Government’s ideas for making it easier for these people to save for retirement.
The NEST scheme is intended for lower earners who don’t have access to a company pension arrangement.
