The FPB is concerned about government legislation to prevent employers from offering incentives to encourage members of staff to opt out of pension schemes. The FPB believes that, if ratified, the Pensions Bill will add to the vast quantity of paperwork and costs faced by many small businesses.
The Bill, currently being read in Parliament, would force employers to contribute a minimum of 3% of their workers' earnings to pension schemes for staff earning between £5,035 and £33,540. In the FPB's latest quarterly poll of members, Referendum, 81% of respondents believed that the Government's proposed ‘personal accounts', which are set to be introduced in 2012, would ‘significantly' add to their administrative burden
The FPB believes it would be unfair to prohibit offering incentives for employees to opt out, leaving employers to foot the bill. The notion that all employers can afford to pay into pension schemes is misguided. The FPB wants the decision whether or not firms can afford to offer such a scheme to be left in the hands of individual businesses.
"Our members are already struggling under the burden of red tape, which is increasing at an alarming rate," said Phil Orford, the FPB's Chief Executive. "The additional paperwork and costs that would be imposed on them could be extremely harmful. The FPB believes that this should be a decision made by business-owners, based on their ability to afford to offer pension schemes."
Many of the FPB's members are livid about the proposal, believing it to be an additional administrative burden.
"Legislative red tape is increasing at a daily rate and it is simply too great for small business to cope with," said Phil Parkinson of Philip Parkinson Home Care Ltd, Newcastle-Upon-Tyne.
"We simply don't have the money," said Christine Robateau of Enhanced Cleaning Services Ltd, Worcestershire. "It would cripple us, so it would just be easier to close."
Richard Gayfer of Scanfit Ltd, Norfolk, is tired of the Government interfering where it should allow entrepreneurs to run their businesses. "It is a further unwelcome interference from the nanny state," he said.
Unlike big companies, most small businesses do not have compliance departments to deal with yet more unwelcome paperwork that is required by the Government.
This often-overwhelming level of bureaucracy is a major factor behind the FPB's ‘Think Smallest First' campaign, in which the FPB is urging the Government to think about the impact its policies have on the UK's smallest businesses.
