Read the sentences below and the extracts from a text about pensions.
For questions 1-
8, choose which extract each sentence refers to. The extracts may be chosen more than
once.
A. Businesses are not currently obliged to provide a workplace pension scheme, but the
2008 Pensions Act requires employers to have a qualifying pension arrangement in place
from 2012. Employers will be obliged to automatically enrol jobholders onto the scheme
and make a minimum contribution to the arrangement. Providing a workplace pension
scheme has a number of benefits. There is income tax relief available on both the
employer’s and employees’ contributions, and where the employer is a corporation,
corporation tax is also available.
B. Of the different work pension plans available, the stakeholder scheme has the
minimum standards. Under this scheme, the money contributed is used to buy
investments, and the investor must be prepared to lose out if these investments do badly.
The benefit of this scheme is that it is flexible in that if employees change jobs, they can
continue to make contributions to the scheme, although any payments the employer
makes will cease. Employees can also make irregular or low payments with no penalties.
C. If a business has more than five employees over the age of eighteen who earn more
than the lower earnings limit, and offers no other pension arrangement, it must offer its
employees access to a stakeholder pension. If the company has four employees and takes
on a fifth, all employees must be given access to a plan within three months of the fifth
employee’s recruitment.
D. The company need not make any contributions, but must offer its employees a payroll
deduction facility. If the employer does contribute, a condition can be set up that the
employee also contributes. Employers must keep a record of any payments they make,
but beyond this, the scheme requires no administration, as this is done by the provider.
The costs for this are deducted from the fund. Annual charges are low, capped at one
percent of funds.
E. Stakeholder pensions are available from a number of banks and other financial service
providers, and it pays to shop around. Find a reputable pension provider which is
registered by the Pensions Regulator. Although a well-established firm is preferable, past
performance is not a reliable indicator of future returns. Also make sure that your pension
all your employees can join the scheme as some limit membership to people working in
certain trades.
Which section, A, B, C, D or E, does each statement 1-8 refer to?
1. ___ In future, it will be necessary for employers to pay into their employees’ pensions.
2. ___ Employers only need to keep minimal paperwork for the stakeholder scheme.
3. ___ A pension from a well-known establishment may not deliver significant profits.
4. ___ Business owners with very few staff need not offer pension schemes.
5. ___ Employees who pay into stakeholder schemes may lose their money.
6. ___ Employees in some occupations may not be eligible for some types of pension.
7. ___ Both large and small businesses can get rebates from paying into employees’
pension funds.
8. ___ If the number of employees on a company’s payroll exceeds a certain figure, a
pension must be offered.
