Draft Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2020

Will Quince Excerpts

Monday 23rd March 2020 General Committees

[The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)]

I beg to move,

That the Committee has considered the draft Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2020.

It is a pleasure to serve under your chairmanship, Ms McDonagh. I am pleased to introduce this draft statutory instrument, which was laid before the House on 2 March.

The draft order reflects the conclusions of this year’s annual review of the automatic enrolment earnings thresholds required by the Pensions Act 2008. The review considered the earnings trigger and the qualifying earnings band for the tax year 2020-21. The earnings trigger determines the point when a qualifying worker becomes eligible to be automatically enrolled into a qualifying workplace pension. The qualifying earnings band determines the earnings upon which workers and employers pay contributions into a workplace pension. The draft order sets a new lower limit for the qualifying earnings band and is effective from 6 April 2020.

The earnings trigger is not changed within the order; it remains at the level set in the automatic enrolment threshold review 2014-15, so no further provision is required. Similarly, the upper earnings limit is not changed within the order; it remains at the level set in the automatic enrolment threshold review 2019-20, so no further provision is required. I am satisfied that this draft order is compatible with the European convention on human rights.

Today’s debate is about a technical element of the automatic enrolment framework, which as a legal necessity that we need to have in place for 6 April 2020. The decision to maintain the earnings trigger at £10,000, and to maintain the alignment of the qualifying earnings band with those for national insurance contributions, maintains simplicity and consistency.

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[Will Quince]

I commend the order to the Committee.

Question put and agreed to.