“Many businesses are completely unaware of the changes and therefore unprepared for introducing the National Pensions Savings Scheme to their staff,” commented Stephen Ingledew, director of Barclays Financial Planning.

This confusion suggests a need for a more comprehensive government information strategy to ensure SMEs are prepared for the introduction of the NPSS in 2012.

The NPSS will introduce “invaluable changes” for the one in five employees who currently make no contribution to their company pension, Mr Ingledew stressed.

Under NPSS they will be required to pay in four per cent of their salary.

But the study also finds many employees would be better off sticking with the contributions their employers pay, which average 4.2 per cent of salaries, than under government provisions, which propose a minimum mandatory contribution of three per cent.

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