Fewer pension scheme members will be offered the chance to transfer out following the introduction of a voluntary code of conduct and changes in how members are advised, law firm Osborne Clarke has said.
Partner Keith Webster said the ban on cash incentives in the code, published earlier this year, would reduce take-up from pension scheme members, making the exercises less attractive to employers.
"ETVs are going to be much rarer than they were in the past," he said.
"Figures suggest you might get a 30% to 40% take-up for these exercises if you offered cash and 10% lower if you didn't."
But he said changes made by the Financial Services Authority (FSA) to assumptions independent financial advisers have to use when advising members whether to transfer would have a more significant impact.
"The amount you have to enhance a transfer to get a green light from an IFA now means you are generally offering something similar to the basis used in the actuarial valuation so there is no sudden improvement in your scheme funding level if you can persuade people to transfer out," he explained.
Webster added that the extra enhancement required also increased the cost to sponsoring employers.
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