Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2021

Baroness Gardner of Parkes Excerpts

Thursday 25th February 2021 Lords Chamber

[Baroness Gardner of Parkes (Con) [V]]

My Lords, the Minister introduced this debate very clearly, and we have had some excellent contributions from Members. I support the order. I have always thought it important that we encourage people to save for their retirement with a pension. The younger you are when you start this pot, the more you have to support yourself as you get older. The introduction of automatic enrolment for pensions was a positive step in this direction, and the massive increase in uptake since it was introduced reflects this.

However, I worry that, in the current climate, this may be a strain too far for businesses, as they struggle under the financial pressure of closing their doors to trade, in part or in full. While the furlough scheme helps with salaries, it does nothing to assist with pensions and national insurance contributions. It is costing all these businesses money to stay closed—from the Richard Ward beauty salon chain racking up debts of £1,000 a day to the likes of the Leon takeaway restaurant losing up to £200,000 a week, rising to £800,000 if you take account of the profit it would usually make.

Pension costs are part of this equation, and even the changes made by this order will trigger an additional group now falling into automatic enrolment, the costs of which will add to employers’ financial worries. I ask the Minister to work with the Chancellor to look at ways of helping these businesses to survive by reducing these costs in the short term.