This document summarizes several financial and employment topics relevant for UK businesses and individuals in October 2012. It discusses the beginning of auto-enrollment pension requirements for large employers, a small increase to the national minimum wage, plans for a new government-backed business bank, and upcoming changes to state pensions and child benefits that may prompt individuals to review their retirement plans.

1. 18 Hyde Gardens
Eastbourne BN21 4PT East Sussex
01323 431 200 eastbourne@plummer-parsons.co.uk
INSIDER
OCT
2012
Welcome to your October
newsletter. Auto-enrolment is
finally kicking off and this month
will see the largest employers
automatically enrol their workers
into a qualifying pension scheme. Do
you and your employees know about the www.plummer-parsons.co.uk
big changes that are happening?
Meanwhile, as new employee regulations are typically brought in twice a year, October also sees a rise in the national
minimum wage. Elsewhere, we touch upon the Government’s initial announcement of a new state backed business bank
as a solution to SMEs struggling to access finance. Finally, in Your Money, we explore why auto-enrolment is just one of
many issues altering the pension landscape; other imminent changes to the state pension and child benefit may prompt
you to review your retirement and pension plans.
Auto-enrolment begins Minimum wage
The Low Pay Commission - the independent
1 October sees the first with information about the advisory body to the Government - reviews
round of eligible employees forthcoming changes, yet the national minimum wage according to
automatically enrolled into a according to research, up to 10 inflation on an annual basis. The rates that
workplace pension scheme, million workers – around 52 come into force from 1 October 2012 are:
žžThe adult rate for workers aged 21 and
as employers with more than per cent of the UK’s working
120,000 in their PAYE scheme population - are unaware of the
are required to auto-enrol. new rules which will see both above will rise 11p from £6.08 to £6.19
These larger employers will the employer and employee per hour
have been working hard to contributing towards a pension. žžThe development rate for workers aged
put provisions in place for 18-20 will stay the same at £4.98 to per
the change, but with smaller It’s important to be up to speed
on your duties as an employer hour
businesses gradually following
suit, what is your business regarding auto-enrolment, žžThe 16-17 year olds rate will stay the
doing to prepare for the new put provisions in place, and same at £3.68 per hour
inform your staff about what
žžThe apprentice rate will rise by 5p from
legislation?
is happening, or you could risk
As an employer, it is your significant penalties. £2.60 to £2.65 per hour.
duty to provide workers
We can help with
employee issues and PAYE.
We can help you with your auto-enrolment duties and Please talk to us to find
communicate with employees. out more.

2. A new Business Bank for small and medium sized businesses
The Government has launched various finance schemes exporters will be the bank’s main targets and it aims to be
in the last couple of years aiming to tackle the ongoing open for business within the next 18 months.
difficulties small businesses face when accessing
finance. Last month, it announced a new £1 billion Although business groups have welcomed the plans, they
Government-backed business bank to bring together have also speculated that the new bank will only replace
the raft of existing finance schemes, create a single schemes such as the Funding for Lending Scheme, Enterprise
port of call for information and advice, ‘shake-up the Capital Funds and the Enterprise Finance Guarantee scheme,
market’ and boost lending to small businesses, in a and offer nothing new. Others were keen to highlight that a
move that it hopes could attract up to £10 billion extra rebranding would not be enough to help Britain’s struggling
lending capital from private sector investors. SMEs and that increased backing would be needed.
Although the scale and timing of the plans are still Full details are expected to be unveiled at the Autumn
under discussion, the Government has indicated that Statement which has now been confirmed to take place on
the new bank will operate through existing lenders and 5 December 2012.
facilitate long-term lending, possibly loans and other
long-term finance with a maturity of up to ten years. We would be pleased to advise regarding
High growth companies such as manufacturers and your business finance options.
YOUR MONEY
The big pensions shake-up – is it time for a review?
Planning for retirement is always invested. It could be beneficial into force next year. The benefit
important, but with big changes to discuss these options with will gradually be withdrawn
happening this month regarding those affected. from households where
žžWill a new single tier state
pensions in the UK, and more individuals earn more than
possibly afoot in the future, now is a £50,000, with a one per cent
particularly good time to consider or pension affect your income? income tax charge of the benefit
review your retirement plans. Research from the Department amount applied for every
of Work and Pensions (DWP) £100 over this income level.
What’s happening? in August revealed that British Depending on your earnings,
pensioners receive anything
žžAuto-enrolment of employees
some households may have
from £7 to £230 a week in their benefit cut altogether. In
into a pension scheme will state pensions. The research some cases putting more into a
begin for employers with more also heightened the case for pension pot could be beneficial,
than 120,000 people in their the introduction of a new single but it’s always best to seek
PAYE scheme from 1 October tier pensions system next year, advice.
2012, and you may want to which would take the state
consider how this may affect pension to £140 a week; a Retirement planning
your household’s pension boost for some, but a loss for is complex and will
income. Auto-enrolment could others. Relying on your state depend on your
be into a qualifying pension pension is usually not enough, personal circumstances.
scheme chosen by the employer and underestimating your Please speak to us for
or into the default National final pension could affect your professional advice.
Employment Savings Trust quality of life in retirement,
(NEST) which is backed by the meaning prudent pension
Government. Alternatively, you planning is vital. October’s Money Facts
could choose to opt out of auto-
enrolment and invest in your žžOther recent research reveals Current bank rate 0.5%
own personal pension fund, that higher rate taxpayers may
channel more money into their Quantitative Easing £375 billion
but which is the best option for
pension savings in an attempt to Scheme
you? For instance, choosing a
personal pension may allow you avoid losing out on child benefit Current inflation 2.5%
to make your own decisions payments when new rules come
about where your pension pot is
www.plummer-parsons.co.uk