Govt to water down auto-enrolment in Autumn Statement

Chancellor George Osborne will delay auto-enrolment for small businesses as part of his strategy for growth, reports have claimed.

Firms employing fewer than 40 staff members will be given an extra year to prepare for auto-enrolment, according to the Daily Mail, which cited a source close to the Treasury.

Businesses with fewer than 50 employees will have to implement auto-enrolment between 2014 and 2015 under current Pensions Regulator (TPR) guidelines.

It is thought minister have decided the delay is intended to help businesses grow whilst avoiding employees opting out of pensions at a time when pay is lagging behind inflation.

Former Labour chancellor Alistair Darling warned in October that the government was considering a delay and urged it to stick to the original timetable or risk the reforms losing momentum.

Last month pensions minister Steve Webb would only confirm the reform would begin in 2012, but refused to go into more detail.