EasyBuild is a cost-effective and easily-administered plan that will fulfil all the administrative obligations employers will face when workplace pensions change in 2012 and in turn employees get access to a flexible and easy-to-understand stakeholder pension. EasyBuild has been designed with the construction industry and its allied trades in mind in that it provides a simple, low cost offering that is truly portable for individuals who regularly change companies and employment status. Construction and allied trades encompasses a broad scope including any companies associated with construction or any groups with a construction association. B&CE’s EasyBuild workplace pension could also appeal to wider industries who may share similar characteristics such as a transient workforce.
To mark the anniversary of EasyBuild’s tenth birthday this month, B&CE is further demonstrating its commitment to the industry and its ethos of returning any surpluses, by announcing the removal of its annual management charge for new and existing EasyBuild customers, during the employer’s first year of auto-enrolment.
Brian Griffiths, CEO of B&CE commented: “As a not for profit organisation with no accountability to shareholders, we always have our customers at the forefront of our activities. We are already operating a successful stakeholder scheme that we have recently enhanced to ensure our customers will help meet their obligations come auto-enrolment from a compliance point of view. We’ve been in business for nearly 70 years and have some 30 years experience in administering pension schemes, firmly placing us as a trusted specialist in this arena.”
He continues ‘Our ethos is that we are here for the benefit of the industry. We strongly believe it’s vital people save towards their retirement and are offering no charge on an employee’s pension fund for the first year, when auto-enrolment is introduced to encourage employee participation. We also envisage that our charge will not exceed 0.5% thereafter. We have no initial service charges and do not charge employers any add-on fees for the services we provide. We believe this makes our charging structure one of the most transparent and competitive of all pension providers in this arena. This reflects our commitment to providing a cost-effective and flexible pension solution, through our workplace pension, EasyBuild.”
EasyBuild launched in 2001 and was developed exclusively for the construction industry and it is one of the largest stakeholder pension schemes in the UK with over 500,000 members and has £670 million of funds under management.
As a not-for-profit organisation that was set up by the industry for the industry nearly 70 years ago, B&CE prides itself on its experience and its service offering.
B&CE offers employers benefits that it believes other stakeholder pension providers can’t compete with based on three-fold delivery:
1. Service – B&CE offers employers a flexible hassle free service and EasyBuild will be designed to take as much of the regulatory burden away from employers as the Regulations will allow. It will be more than just a pension scheme.
2 .Simple fund choices based on attitude to risk - EasyBuild’s fund choice is simple, but comprehensive. It’s designed to appeal to the entire workforce.
3. A fair charging structure – B&CE bases its charges on cost not profit and does not pay commission; something that is uncommon within its sector. More importantly, it means its customers, from those working for the largest multinational construction company to the smallest local builder are able to benefit from low rates assisting them to build a meaningful income in retirement. Without shareholders to serve, any surpluses gained are returned to the construction industry, which results in the continued delivery of first-class products and services.
Based on all of this, B&CE believes its EasyBuild offering is a complete and highly attractive solution meeting the automatic enrolment requirements for employers and employees alike. B&CE has always prided itself on ‘taking the hassle away’ and providing a personal service and will continue to do so. The 0% Annual Management Charge will apply for the first 12 months of the auto-enrolment process for each employer and further demonstrates B&CE’s ongoing pledge to help our customers in the most practical ways it can.
Brian continues “We’ve made some significant improvements to our offering but it does not stop there as we are continually reviewing our products to ensure they meet the needs of our customers. We are committed to keeping charges low, based on cost not profit, and at the end of the 12 month period we envisage the AMC will be no more than 0.5% for those actively employed.”
Employer obligations and implications.
October 2012 (companies can start contributing in July 2012) signals the official start of the government’s new compulsory employer duties, which require all employers to automatically enroll all eligible employees into a qualifying pension arrangement, such as EasyBuild, as well as make contributions towards it. The financial and administrative impact the pension reforms will undoubtedly have on the industry means employers and their employees will need guidance throughout this complex process. To put the financial implications into context and as reported by B&CE last month (March 2011), employers’ contributions in the construction industry could reach as much as £1.17bn by 2018 (based on average weekly wage of £532 for a construction worker).
Over a period known as staging (based on the size of the workforce) and by September 2016 all employers will be legally required to:
1. Enroll their employees automatically into a qualifying workplace pension scheme such as EasyBuild
2. Pay a minimum contribution of 1% of band earnings into this scheme from their staging date, rising to 3% from September 2017
3. Keep records relating to pension arrangements, the enrolment of members, salary and contribution histories and members’ opt out and opt in notices
4. Every three years automatically re-enroll employees who choose to opt out
Brian Griffiths concludes “Although the reforms might seem some way off, we would urge all employers in the industry to start preparing themselves and their employees for this unprecedented change in the way everyone needs to save for retirement. Employers need to allow themselves enough time to have a provider in place, such as B&CE, that can offer a scheme that is right for their business which means: understanding the complexities of the workforce; being able to offer the right fund choices (understanding employees’ attitude to risk) and a clear commitment to providing a first-class service.”
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