Thursday 07 April 2022
The Committee for Employment & Social Security has submitted a Policy Letter outlining further details of Your Island Pension (YIP), the government-facilitated secondary pensions scheme.
The Policy Letter outlines the proposed governance arrangements for YIP and the proposals for monitoring employer compliance with the new obligations under secondary pensions legislation.
If the States agree to the proposals set out in this Policy Letter, it is anticipated that the secondary pensions obligations will come into force on 1st October 2023, subject to the relevant legislation being approved in 2022.
This date has been agreed to provide employers and pension providers with sufficient time to prepare once the secondary pensions legislation has been approved by the States, which is expected to be in Quarter 3 this year.
The auto-enrolment obligations for employers will be phased-in over a period of 15 months according to the number of employees, starting with larger employers.
Deputy Peter Roffey, President of the Committee for Employment & Social Security, said:
'To deliver the intended aim of supporting people to save for retirement we need to ensure that employers comply with their secondary pensions obligations. Whilst we are confident that the vast majority of businesses will comply, it's important to have these measures in place for those who would seek to deprive employees of the benefits of a secondary pension scheme.
'The proposed compliance measures have been crafted in such a way that they come at minimal cost to employers and the States of Guernsey, by adapting existing processes wherever possible.'
Under secondary pension legislation, employers will be required to contribute at least minimum levels into either a qualifying pension scheme or into the YIP following automatic enrolment of their employees.
The main aim of the secondary pension scheme is to support more working age people to save for their retirement, thereby enabling them to enjoy a more comfortable retirement and controlling welfare expenditure in the longer-term.