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Chairman says stakeholder won&#39t work unless it&#39s made compulsory

Stakeholder pensions will not work unless the Government introduces

compulsion, says M&E Network chairman Barry Kayes.

He told the network&#39s national conference in Birmingham last week that the

target audience of low to middle earners will not be persuaded to take out

a stakeholder scheme unless they are forced to do so by the Government.

Kayes said he believed advice would play an important role in the

stakeholder market despite the Government&#39s attempts to remove the need for

advice with decision trees.

Kayes said: “Compulsion may be necessary. It will have to happen in order

for stakeholders to be any kind of success.”

His comments were supported by a number of other speakers, including

Scottish Life head of pensions strategy Steve Bee and IFA Ward Mitchell

Partnership chairman Steven Mitchell.

Stakeholder came under close scrutiny, with many IFAs and pension

providers criticising the initiative, clai-ming it is too complicated and

difficult to explain to employers.

Bee said if employers do not set up a stake-holder scheme they face a

£50,000 fine from Opra.

He said he could not see how decision trees can possibly work.

Bee said: “It seems inconceivable that anyone could sell a pension to

anyone without providing advice.”


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