Thousands of firms may have missed stakeholder deadline

As many as 50,000 small companies may have missed last month's deadline for designating a stakeholder pension scheme.

Companies with five or more employees were required to designate a stakeholder scheme by 8 October or risk a £50,000 fine. Those who already provided an occupational pension scheme or group personal pension into which the employer pays 3% of earnings did not have to designate a scheme unless they restricted membership in some way.

The government estimated that between 300,000 and 350,000 firms were likely to be covered by the stakeholder requirements. The latest figures from the Association of British Insurers indicated that just over 212,000 had designated a scheme by the end of September. Even assuming a big rush in the final week this could still leave 50,000 or more missing the deadline.

Stakeholder pension schemes come within the remit of the Occupational Pensions Regulatory Authority (OPRA) whose latest bulletin sets out how it will deal with those missing the deadline. OPRA will rely on companies being reported for failing to comply and so it will be up to trade union reps or individual employees to blow the whistle.

At this stage OPRA says it is "likely to show lenience towards an employer who has made serious efforts to comply but who has been thwarted by events outside their control." It will be "toughest with those who show defiance and who have deliberately ignored the law".