By Marcus Leach

Ninety per cent of FTSE 100 companies have already considered the impact the forthcoming Pensions Reform changes will have on their businesses and employee benefit provision according to annual Towers Watsons research.

The company's latest FTSE100 Survey of Defined Contribution (DC) Pension Provision shows that only 8 per cent, down from a quarter the year before, believe that no changes need to be made to their current arrangements in order to comply with the new requirements.

"It is heartening to see how many companies have taken advantage of the increase in detailed information about the regulatory changes from October 2012 onwards and have considered their reaction to the introduction of auto-enrolment and minimum benefit levels," Paul Macro, senior consultant at Towers Watson said.

The survey also shows that many organisations plan to use their existing arrangements, with modifications where necessary, to meet the auto-enrolment criteria. Only two companies intend to use NEST as their main pension scheme for new joiners.

Some 41 per cent already auto-enrol their employees into DC schemes, a further 28 per cent state they will change their joining approach as a result of the 2012 pensions reform, but the position of the remaining 31 per cent is unclear.

According to Towers Watson, overall DC membership remained unchanged during the last year, with around half of all employees of FTSE 100 companies being members of a DC pension scheme. However, the number of non-joiners has increased to 23 per cent from 18 per cent the previous year. From 2012 onwards these members will be required to join their employer's nominated qualifying pension scheme.

"It is alarming to note that almost a quarter of FTSE 100 employees choose not to, or are not eligible to join their company's pension scheme, particularly in light of the 2012 pensions reforms and auto-enrolment legislation," Macro said.

"With less than 18 months to go until the phased introduction of the requirement for companies to auto-enrol employees into a qualifying scheme, some companies will need to give serious consideration to their benefit provision. They also need to decide whether they will update their scheme design to become a qualifying scheme, use NEST or use a mixture of both all of these options could bring administrative headaches for payroll and HR teams."