Pension (Extension of Automatic Enrolment) Act 2023

The Pensions (Extension of Automatic Enrolment) Act 2023 received royal assent on 18 September 2023. This new legislation proposes to amend the Pensions Act 2008 by allowing for the automatic enrolment regime to be extended.

Under the new law, the Secretary of State will have the authority to be able to introduce new regulations to:

• Reduce the lower age limit for auto-enrolment from 22 to 18
• Remove the lower earnings limit for qualifying earnings (this is currently £6,240 per annum) so that contributions are calculated from the first £1 earned up to the upper limit (currently £50,270 per annum)

Such changes, as and when they come in, will mean that employers will be required to offer employees from the age of 18 the option to pay into a pension scheme. It also means that employers will also start contributing to employees’ pensions at a much earlier stage.

The government will need to make further regulations to bring in the changes mentioned above, and as a result, the Department for Work and Pensions has confirmed it will launch a consultation period to consider implementing the new measures. 

Currently, there is no proposed timeframe as to when we can expect the changes to come into effect. We will, however, keep you updated as and when we become aware of any developments in this area.

In the meantime, if you would like to find out about how the employment and BLHR team might support you with appropriate training within your organisation, please do get in touch with any member of the team. We offer a fixed fee BLHR service.