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Govt hopes for Sandler-style plans are slammed

The Government is pinning its hopes on Sandler-style pensions distributed through high-street banks and State-sponsored phone and web advice services to increase pension provision among low and middle earners.

But IFAs and providers have slammed the proposals, saying pensions will not be sold as long as there is a rigid commission cap on Sandler&#39s suite of products, which is likely to subsume existing stakeholder pensions.

The Government hopes people will be more likely to take out pensions once they get statutory money-purchase illustrations, which come in next April. The DWP is also proposing to establish public access to advice through a revamped tree-walking website and phone advice centre.

Pensions minister Andrew Smith told Parliament this week: “To broaden access to advice, we will work with the industry to develop mass-market advice in high-street banks and will consult on options for a possible requirement on emp-loyers who do not provide pensions to offer advice free of charge through the workplace.”

Scottish Equitable pensions development director Stewart Ritchie says: “The 1 per cent charge cap is the real issue – there is nothing in the speech about making it easier to distribute pensions. One of the prime reasons for the poor take-up of stakeholder is that there is no margin for advice.”

Informed Choice managing director Nick Bamford says: “I am not impressed with the idea of the Government getting involved in giving advice through a website.”

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