Can advisers make money from auto-enrolment?

Henry Tapper

February 2015

The known opportunity

Competence declines

Did anyone ever consider advice?

DWP initial impact assessment June 2012

In 2014 , a typical budget for staging auto-enrolment was £1,500.(source First Actuarial)

We anticipate that this will halve in 2016 and halve again in 2017

What support do bosses want?

When do they want it?

Who do they want it from?

IFAs supporting accountants?

Or is payroll cleaning up?

W

Payroll the new experts?

W

Middleware model under strain

Price crunch

Sage and IRIS who dominate the SME and micro payroll market are able to drive down prices and destroy competition

Packaged compliance services now available at £79 (+VAT) for implementation and £29pm ongoing.

Risk management

Employers concerned about data management

PAPDIS – the common data standard

Payroll is still fractured

But likely to manage going forward

Paying attention to the pension?

The regulatory position

Can advisers be providers?

ConclusionsAnnuity models are risky (vertical integration and middleware)

AE consultancy requires a high level of skill and knowledge

IFAs•are not traditionally skilled at project management •will struggle to compete with payroll on data management•have no source of proprietary whole of market research

Outsourcing to third parties (project management services) is increasingly popular.

But does this leave the adviser with sufficient value?

Is auto-enrolment best avoided or embraced?