The Association of Convenience Stores (ACS) has called for more to be done to reduce costs for small businesses following the release of a government white paper on pensions.

The white paper makes proposals including employer contributions of three percent and employee payments of four per cent with one percent tax relief and a system of personal accounts into which employees would be automatically enrolled.

ACS chief executive James Lowman said: “ACS has submitted detailed evidence to the government on the impact that compulsory employer contributions to pensions will have on the local shop sector. This direct cost impact should not be underestimated.

“Local shops operate in an intensively competitive market place where any increase in costs affects the profitability of the business. We have estimated that these costs alone will add more than one per cent to employment costs.

“While we welcome a phasing in of employer contributions and not tasking employers to give advice on which provider to choose the government has to do far more to minimise the cost burden of these proposals for small businesses.”

Lowman adds that the future security of the growing self-employed workforce is being treated as a side-issue. “Of the three million self-employed in the UK, two million are not saving, and these proposals offer little for their pension provision. If this issue is not taken seriously, the government will be creating a significant disincentive to entrepreneurs and job creation,” he said.

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