RPC deems AE ‘fit for purpose’ for offshore workers in PIR

The Regulatory Policy Committee (RPC) has notified the Department for Work and Pensions (DWP) that it believed auto-enrolment policy was ‘fit for purpose’ for offshore workers in a post-implementation review (PIR).

It said that there are around 27,000 UK seafarers and offshore workers were eligible for auto-enrolment, and highlighted that it needed to “clarify and legislate for the treatment of seafarers and offshore workers, ensuring they are covered by the programme”.

At the current opt-out rate of nine per cent, RPS estimated employer contributions for 2018 would have been £11m, member contribution costs would have been £16m and government contribution costs would have been £5m.

Although the RPC deemed auto-enrolment fit for purpose for overseas workers, it set out two areas of improvement for the government’s analysis.

It said that the DWP could have used its opt-out rate analysis to “infer how the different opt-out rate scenarios for seafarers and offshore workers could have affected the equivalent annual net direct cost to business and net present value figures”.

Secondly, the RPC said: “The department could have provided further explanation of any specific methods considered to achieve the policy objective with a reduced level of regulatory burden for maritime employers.

“This would also then clarify to what extent proposed moves to reduce regulatory burdens would weaken compliance.”

As part of this recommendation, it said that the PIR could have benefitted from further discussion on why offshore workers were originally left out of the auto-enrolment programme.

The RPC concluded: “The PIR has provided sufficient justification as to why specific conclusions cannot be reached regarding the impacts of the legislation on the specific groups analysed in this review.

“The review has also provided an assessment of the unintended effects and disproportionate effects based on stakeholder engagement. The RPC welcomes the department’s intent to gather more effective evidence to inform future reviews of this legislation.”

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