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Commission cut by third as Standard restructures

Standard Life is cutting IFA commission by up to a third by bringing all its pension products on to its fund-based commission structure.

Standard repriced its pension book to within 1 per cent earlier this year.

All executive pension plans, small self-administered schemes, contractedin money purchase schemes and retirement account plans will work on Standard&#39s commission accelerator system, which pays advisers a fund-based amount up-front then reclaims it in the early years of the contract.

Under this system, commission will be up to a third lower than Standard&#39s old initial commission rates.

Standard brought its personal pension range on to a single-charging structure within 1 per cent last April. These products have been on the commission accelerator system since then.

Senior technical manager John Lawson says: “The new commission options are not directly comparable but the maximum on the new basis is roughly two-thirds to 75 per cent of the old system of initial commission.”

Informed Choice managing director Nick Bamford says: “This has to have been expected. It is a natural follow-on from the environment we are in where charges come down, the level of commission will have to come down.”

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