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Brown’s big blunder

The Chancellor’s U-turn on allowing residential prop- erty in Sipps is a multi-million-pound blunder, say industry experts.

Accountants Grant Thornton says that several million pounds spent by providers, lenders and advisers in prep- aration has been wasted due to the pre-Budget report’s hammer blow this week.

Tax partner Richard Proctor says it is impossible to estimate the exact figure- and no major insurers are announcing their losses- but thousands of Grant Thornton clients alone will be affected.

Teamspirit retirement consultant Jo Smith says as well as system costs, there are indirect expenses, such as management and adviser time which will ratchet up losses.

Property Platform did a deal with Pensions Associates to offer overseas property in Sipps.

Property Platform director Ian Liborwich sunk 80,000 over 14 months into developing a property Sipp platform for IFAs and will now have to explain to investors why the service is being pulled.

Proctor says: “When you consider all the costs of preparing for this, it must run into millions of pounds, although it is impossible for us to estimate a more precise figure than that.”

Egg Design director Martin Fox says: “It is not just the advertising and marketing, you have to consider the management time that has been taken with firms planning. Companies will have been set up off the back of this and teams have been built looking for specific expertise.”

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