Almost half of small and medium sized companies haven’t prepared themselves for auto-enrolment, according to new research by NOW: Pensions.

The workplace pensions provider found that over 22 per cent of the 450 SMEs surveyed by BDRC Continental intend on using their existing pension provider for auto-enrolment. Just 2 per cent have already secured another scheme.

Defaqto research conducted with 264 independent financial advisors last year found that 86 per cent of advisers anticipate growing numbers of pension providers will not offer their auto-enrolment schemes to SMEs.

NOW: Pensions CEO Morten Nilsson said companies planning on staying with their existing provider are “taking a gamble” and not all pension providers are happy to accept all companies and all employers on equal terms.

“Speak to your existing provider sooner rather than later so you know where you stand and make sure you have alternative plans in place,” he advised.

Despite a large number of SMEs being unprepared, over half of firms surveyed think that their choice of pension provider is either important or very important. Eight per cent said they think their choice is unimportant.

“Selecting the right pension scheme for auto-enrolment is important and has long term implications for employees,” Nilsson said. “Taking time to review the options that are available in the market is sensible and planning ahead will help to keep stress levels to a minimum.”

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