Why manage a pension?
Running costs
Salary sacrifice savings
Return on investment
Personal accounts
Evaluating investments
Sponsor's message: Push pensions' value
Download: How to evaluate pensions (PDF 654KB)
A pension scheme is a must-have benefit for most employers. But the cost of providing this benefit to staff can be considerable and the impact of a pension on recruitment and retention is often difficult to ascertain.
Many organisations faced with huge deficits on their defined benefit schemes have been forced to close them and switch to defined contribution schemes, with those employers wanting to keep risk and costs to a minimum opting for contract-based group personal pension plans or stakeholder schemes. Government plans for a National Pensions Savings Scheme, with auto-enrolment and compulsory employer contributions of 3%, are likely to result in more organisations reviewing their pension arrangements prior to the scheme's implementation in 2012 and some may decide to level down their contributions.
Organisations should think about what they want to achieve with their pensions provision going forward. Do they want to be an employer of choice or do they want to undermine this valuable perk by offering the minimum? Hopefully, this guide will help you evaluate your pension arrangements.
Amanda Wilkinson
Editor, Employee Benefits magazine