Download - CIPP AAP pensionsync
AUTO ENROLMENT FOR AGENTS
Will Lovegrove CEO pensionsync
AAT / CIPP hot topic event Manchester 3rd March 2016
pensionsync : think of us as Switzerland in the Europe of AE We’re in the middle. We’re big on efficiency. We don’t pick sides.
• Designing your service
• Engaging ‘slow to respond’ clients
• Pension scheme selection
• Different software options
• Automatic re-enrolment
CIPP asked us to speak on these points:
• Educate your clients on AE - a general briefing
• Support them through the selection of a pension scheme
• Open a pension scheme with a pension provider on behalf of your client
• Process AE each payroll period
• Create statutory communications
• Create & upload data to the pension provider
Service design is consistentIt wasn’t always like this, but after processing AE for 3 years and for approx 10% of their Clients, successful agents have settled on a modus operandi
PRICING
The pricing structure is based on client size, fixed monthly fee for 1 to 3 employees and a per
payslip basis on a pricing scale for 4 employees and more.
Currently charged a fixed fee for assessment and enrolment. Additional fees apply for :
Communications - charged per letter Output file – charged per file
PRICING
Fee based on size of payroll and which provider has been selected.
Pricing is done on a bespoke basis – based on payroll size for processing. Letters
are charged per head.
PRICING
Up to 75 employees we have a banded fixed monthly fee based on the
number of employees. On 76 and over we charge per payslip.
No additional fees – AE is included as standard. However we charge additional for
‘setting up’ a pension.
PRICING
We charge per employee fee. We have fixed prices for 3 major master trusts. In some cases
we have a fixed monthly fee.
We charge for set up of pension scheme, We charge for declaration of compliance form
We charge for assessing, communications and uploads to pension company.
UNLIKE SERVICE DESIGN, PRICING HAS NOT STABILISED.
IT IS STILL BESPOKE & COMPLEX.
BUT IT WILL NORMALISE PROBABLY WITHIN 24 MONTHS
WHAT IS THE APPROXIMATE PAYROLL CHARGE % INCREASE TO
CLIENTS
Depends on size of the client: typically 25%
30%
50%
NOW Pensions: 16% - 70%NEST & Peoples: 96% - 147%
Others: 16% – 150%Client Self Manages in full: 0%
Client Self Manages in Part: 3% - 10%
40% - 45%
DO YOU OFFER DIFFERENTIAL PRICING?
2
5
No Yes
Differential pricing is attributed to the variances in difficulty of administrating with different pension
providers. Its not popular, but does exist.
DIFFERENTIAL PRICING EXISTS
It has been necessary to create differential pricing based on provider as some have much more
onerous procedures than others taking a lot more time. Some are also prone to more
errors so time has to be factored in for these.
Pricing varies across the market. Pricing is driven by how much
‘manual’ time is needed to process AE. E.g. the bits that cannot be
done by software
ENGAGING SLOW TO RESPOND CLIENTS
90% of clients are slow to respond. Fees structured so the less time left to set up
AE the more it costs the client.
Regular email, phone calls. There are some clients who still have a head in the sand
approach but very few now, most are receptive.
ENGAGING SLOW TO RESPOND CLIENTS
80% of our clients are slow to respond. Yes – we email them
every month and if they have not done anything 2 months before staging we
telephone.
ENGAGING SLOW TO RESPOND CLIENTS
I do remind them of the hefty fines if they don’t comply and continue to
bury their head in the sand.
The most I have had to contact a client is 7 calls! Generally we have settled AE by the first
meeting, after the first phone call.
ENGAGING SLOW TO RESPOND CLIENTS
No - but we are considering some options
Hard to say [a percentage] as majority not staging until later this year. We simply repeatedly chase slow to
respond clients.
PENSION SCHEME SELECTION
We tell them we have a scheme with SMART where we will do everything for them.
However we do say they have a choice of provider and need to satisfy themselves that the scheme we provide is suitable for
their requirements.
Our sister company is a Financial Planner and we do refer our Clients to them if they need
support.
We recommended speaking to an IFA for pension advice.
SIMPLIFYING THE PROCESS & PROPOSITION IS A GOOD STRATEGY
FOR AGENTS.
BUT SUCCESSFUL AGENTS EMPHASIS THAT THERE IS CHOICE IN THE
MARKET.
PENSION SCHEME SELECTION
90% of clients ask for help selecting a scheme. We refer all our Clients to
our internal FAs
95% of Clients ask for help. We send a list of providers available and request they do the appropriate research to choose a scheme.
We do refer Clients to an IFA.
PENSION SCHEME SELECTION
We have a strategic relationship with an IFA and refer our clients to them.
67% of clients need help with scheme selection. We currently operate with only with 3 providers:
NEST, People’s & NOW.We are looking to expand this though
We do refer Clients to a partner adviser
PENSION SCHEME SELECTION
We offer Pension Playpen as an assistance to choosing their scheme or speak to an IFA. We do have a strategic relationship with
an IFA
95% of clients need help selecting a scheme.
If they don’t want an IFA we offer the Pension Playpen which is a fantastic platform to help select a
pension.
DO YOU OFFER GUIDANCE?
6
2
No Yes
Guidance is not advice. Guidance is a presentation of the facts, but without a resulting recommendation. The majority of agents understand the difference and are comfortable with giving Guidance.
DO YOU REFER TO TPR WEBSITE?
7
1
No Yes
Overwhelmingly the majority refer their clients to the TPR website
Your Clients will ask you for help. You should formulate options to help your clients choose a scheme.
Smaller Clients may not want to pay for an IFA. Guidance may be enough. Emerging software tools will
mean there is a low-cost alternative.
DIFFERENT SOFTWARE OPTIONS
we prefer to manage the workplace assessments [in payroll] as it sits comfortably in the
payroll process.
Differential pricing: No we don’t, as it is hard enough for our clients to have the extra charges, so some we win and
they take no time and some take longer – but using pensionsync this will be a thing of the past.
DIFFERENT SOFTWARE OPTIONS
We have not considered changing payroll software because together with pensionsync it
provides all the functionality we need
We did consider changing and looked at
other payroll software last year, but after major updates and changes due to AE we are happy
with our payroll functionality
DIFFERENT SOFTWARE OPTIONS
I do see it as unfair that software providers are charging
additionally for it- AE is simply a part of payroll it’s not optional.
You cannot administer AE without software. Different software does different things (at the moment).
Your choice of software will impact your range of services and efficiency.
Generally speaking Payroll Bureaus are reluctant to switch software, but many small bureaus operate
multiple payroll software products in parallel
Software will in time help normalise the work effort to administrate pensions, create ubiquitous equal access to different
providers, and so ultimately normalise the pricing structure for pension administration
in the market.
EDUCATE YOUR CLIENTS ABOUT AE
Regular newslettersSeminars
Targeted correspondence as Client approaches Staging DateFree workforce assessment report
All of our payroll staff have been trained on AE and we have held
seminars in conjunction with the Pension Regulator. We have ensured our systems can
make the process as seamless as possible. Clients want the simplest route to be compliant and
are more than happy to follow our guidance.
EDUCATE YOUR STAFF ABOUT AE
WITH THANKS TO:
Liz Robins [email protected]
Nicky Godard-Dady [email protected]
Hayley Whitten [email protected]
Michelle Webb [email protected]
Caroline Gibbs [email protected]
Matthew Duro [email protected]
Robin Mead [email protected]
Suzanne Gallagher [email protected]