PENSION contributions from small businesses are flatlining, according to research from the Association of Consulting Actuaries (ACA).

The 2012 Smaller Firms' Pensions Survey, which looks at companies with fewer than 250 employees, found payments into pension schemes have remained static since the previous report in 2010.

ACA said the trend was "alarming" given longer life spans and the lower investment returns seen in recent years. On average the combined contribution has been steady at 9% of earnings into trust-based schemes and around 7% into contract-based plans.

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Businesses said lower employer National Insurance rates, less red tape and a reduction in corporation tax would be the best ways to help them boost pension contributions. Companies added that lowering NI and income tax would encourage employees to pay more into pensions.