Pension providers say the FSA ignored the advice it received from the industry before its consultation on radical changes to Sipp disclosure rules.
AJ Bell marketing director Billy Mackay says the regu- lator has “lost sight” of its aims in its consultation paper on pension disclosure, published last week, and has failed to heed advice from industry experts despite engaging in 18 months of discussions with the industry.
Mackay says the FSA’s dec- ision to require product providers to supply illustrations and projections for all investments within a pension scheme, except from a list of excluded asset types, will not make it easier for consumers to compare pensions.
He says the FSA should have listed a number of areas where commonality occurs and demand that providers offer illustrations in these areas.
Mackay says: “We say if it is investments which are similar to those in personal pensions, which is typically funds, collectives and cash, then you should require people to provide a KFI.
“But they have turned it on its head and said the exemption only applies to property, shares and ETFs. But there are still a lot of things beyond that which you can invest in a Sipp that cannot be held in a personal pension or a platform.”
Moresipps founder John Moret says: “There will not be any material benefit from these proposals and there is potential for more confusion and extra cost.”
“Comparing the impact of charges is only really meaningful where investments are limited to cash and collective investments. Comparing the costs of different Sipp wrappers, while relatively easy to achieve, does not tell the full story. Ultimately, it is likely to be the investment costs and the investment performance which will determine whe- ther the buying decision was the right one.”