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Nest survey reveals IFAs winning race for auto-enrolment advice
by Daniel Grote on Jan 30, 2013 at 08:11
A survey by the National Employment Savings Trust (Nest) has revealed that companies are looking to IFAs above all other sources of advice as they cope with the onset of auto-enrolment.
Small and medium-sized employers who have sought, or will seek, advice, are turning to IFAs above other professions. More than two-thirds of employers with between 50 and 99 workers plan to use IFAs, a third will rely on their pension provider, 14% will use an accountant, and one in 10 will employ an employee benefit consultant (EBCs).
For employers with between 100 and 999 workers, IFAs again come out on top. More than half of respondents said they would use an IFA, compared to 41% who would consult their pension provider, 18% which would use an EBC and 14% an accountant.
Pension providers steal a slight edge for employers with between 1,000 and 4,999 workers, 49% of which said they would use their services, compared to 48% which will use IFAs. A third of those companies will use EBCs, 18% will use lawyers and 11% accountants.
Only for the largest companies, with more than 5,000 workers, do the EBC giants trump IFAs, with 47% of these firms planning to use their services, compared to a quarter planning to use an IFA. But pension providers emerge on top for this grouping, with 51% of large companies planning to consult them.
Nest said its research showed that the demand for advice would peak around the staging dates for different sizes of firms. ‘Expected reliance on advisers is greater at the early understanding stages of the process with more employers expecting to rely on payroll providers at the later stages, such as setting up and making contributions,’ said the report.
Personal Finance Society chief executive Fay Goddard (pictured) said research undertaken by the Chartered Insurance Institute underlined the importance of advisers in auto-enrolment.
‘If professional advisers can help alleviate some of the burden to employers and promote the value of long-term savings to employees, automatic enrolment will be a win-win for all,’ she said.
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