Although the country has been out of recession for a couple of years now, employers are still facing a number of challenges posed by the economic climate. In particular, budgeting for benefits in a stagnant economy can cause headaches for benefits professionals as they try to strike a balance between ensuring employees feel motivated and appreciated, and controlling the cost of their reward package. This month’s cover story, therefore, looks at how reward professionals can extract maximum value from their organisation’s benefits in an era of high inflation, coupled, in many cases, with low wage increases.
Pensions are one area in which many employers are expecting to experience an increase in costs, particularly as the pension reforms due to begin coming into effect from 2012 loom ever nearer. According to estimates by the Department for Work and Pensions, auto-enrolment will cost employers about £3.5 billion a year in the form of potentially increased scheme membership, possible higher employer contribution costs, and administrative and planning overheads.
In March, Employee Benefits gathered together a lively panel of leading reward and pensions professionals to discuss the impact of auto-enrolment, along with the steps employers can take to prepare and mitigate the effects on their organisation. Their views can be found in this month’s Pensions Auto-Enrolment Roundtable Discussion supplement.
Also included with this month’s issue is The Benefits Book 2011, featuring the Employee Benefits/Alexander Forbes Benefits Research 2011. In keeping with the pensions theme, this year’s survey found that just under two-thirds of respondents expect to experience increased costs as a result of complying with the 2012 reforms. But rather than reducing existing pension benefits, as has been expected, the most popular way employers expect to deal with cost increases is to absorb them into other areas of the business.
As with all of our research surveys, we have carried out a prize draw among our respondents. This time, the lucky winner of £100 worth of retail vouchers was Andrew Darlison, head of reward and benefits at Clifford Chance.
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