Comments from IFAs and others present at this weekend's PIMS 2004 conference suggest a basic lack of suitably qualified advisers could scupper the government's pensions reforms - yet, also create more business for IFAs.
The question has been thrust into the spotlight again because of comments from pensions expert Steve Bee, Scottish Life’s head of pensions strategy, who has warned conference delegates of the tight scheduling of any changes to clients’ pensions that must be made on A-Day.
Bee has repeated the point that any applications for protection – primary or enhanced – must be made on that day in April 2006 only, which leaves advisers in the position of having to potentially handle millions of pensions policies over a 24-hour period.
Bee adds a third un-spoken option - that of doing nothing in regards to protection - is looking increasingly likely.
Subsequently, IFAs and others present at the conference have questioned whether there are enough G60 qualified advisers able to handle clients’ demands against the tight schedule outlined in the legislation determining A-Day.
Stewart Ritchie, pensions development director Scottish Equitable, today confirms his discussions with the FSA suggest the regulator will not require G60 qualifications of advisers dealing with the protection issue, because it will not classify such actions as recommendations for opt-outs from schemes.
However, in what is clearly a case of theory and practice clashing head-on, Ritchie also says that clients at or near the lifetime limit on A-Day are more than likely to want their advisers to be G60 qualified.
”The advice issues are likely to be complex,” Ritchie says.
Comments from both investment management and pensions-focused intermediaries at the PIMS conference suggest the issue of G60 availability alone could create havoc for their clients.
One suggestion has been that even if advisers start warning clients now of the choices they face, well ahead of A-Day itself, it may be that a crunch develops in terms of time management closer to the event.
However, it is not all bad news: one view is that this issue represents a great incentive for IFAs to become G60 qualified, because demand for their services are expected to increase substantially in the next couple of years.IFAonline
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