Partner Article

New pension will stop SMEs employing

A SMALL business support organisation has warned that recent Government changes to pensions and retirement rules will hamper job creation among smaller firms.

The Forum of Private Business - which represents a number of small businesses across the region- is arguing that the decision to force companies into providing pensions for employees and remove the Default Retirement Age (DRA) will deal a double blow to smaller employers.

Phil McCabe, Forum spokesman said: “The Government has stated repeatedly that it wants the private sector to pull the UK out of the economic doldrums by driving job creation.

“Yet by abolishing the DRA and forcing even the smallest of businesses to provide pensions for their staff, it is creating a huge incentive for firms to avoid providing proper, permanent jobs due to the risks and costs involved.”

Additionally, the organisation is arguing that the Government’s intention to remove an employers’ ability to retire workers as part of its abolition of the DRA will act as an extra disincentive for small employers to recruit.

They believe that by making businesses of all sizes provide pension provisions from 2012 – even if they only employ a single person – is not just unfair but will add cost and create extra administrative burdens when small businesses can least afford it.

Phil McCabe ADDED: “We appreciate that the Government needs to tackle the pensions shortfall and reduce the costs associated with an ageing population, but it is unfair and counter-productive that businesses struggling to emerge from one of the worst recessions in living memory should be expected to foot the bill.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .