The FSA says stakeholder pensions could be dropped from the Sandler suite because its research shows that only 54 per cent of consumers would get the right recommendation.
In its consultation on the Sandler light-touch sales reg-ime, the FSA raises concerns that 46 per cent of sales process outcomes are falling outside the “good” category.
The FSA's cost-benefit ana-lysis shows that 27 per cent of outcomes are inconclusive – meaning it was not possible to tell whether the recommendation was right or wrong – while 2 per cent led to missales and a further 17 per cent came out as “tolerable” which it des-cribed as resulting in a “sub-optimal financial outcome”.
The regulator says the main reason that consumers are not getting good recommendations is because many of them do not know they are members of an occupational scheme.
The FSA's consultation paper also sets out concerns that development of the Markets in Financial Instruments Directive will “place some uncertainty” over the viability of the Sandler collective investment product.
FSA spokeswoman Jackie Blyth says: “The results of the research are not as good as we would like. At this stage, you cannot assume that any of the products will go ahead.”
Clerical Medical pensions strategy manager Nigel Stammers says: “If the stakeholder pension and the collective inv-estment products fall out, you haven't got much of a suite left.”