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Hey advisers, leave those Sipps alone

Following last week’s debate about so-called “pseudo” Sipps operating in the market, a couple of people have jumped to their defence.

Hargreaves Lansdown head of pensions research Tom McPhail says the rumours that a species of pseudo-Sipp has been spotted off the coast of Cornwall pretending to be a real Sipp are unfounded.

He thinks it will not serve the industry well to descend into “this kind of factional bickering” and says the important thing is that investors are getting interested in pensions due to the continuing popularity of Sipps – which can only be a good thing.

Pointon York Sipp Solutions is now allowing in specie commercial property transfers into its Sipp.

In May, HM Revenue & Customs said that in specie contributions were not permitted by legislation unless investors made a legally enforceable promise to pay a certain level of contribution into the Sipp.

This led to many providers disallowing in specie contributions due to practical and legal concerns.

PYSS has resolved this by telling investors that they must sign an “irrevocable, legally enforceable document” under which investors must agree to pay a certain amount into their Sipp before transferring the property into the pension.

But it seems as if very few Sipp providers have found a suitable way of determining the value of shares as an asset for contributions. Let me know if your company has found a solution to this.

Annuities are fairly high on the pensions news agenda this week with calls from providers for the FSA to force all annuity providers to publish their rates.

Standard Life head of pensions policy John Lawson says firms such as HBOS that do not make their rates publicly available are not treating customers fairly.

Aegon head of pensions development Rachel Vahey says providers that offer annuities to closed pension books should also have to publish their rates because they are often among the least competitive rates.

But HBOS says that it does not actively market its own annuities and therefore they are not published.

The Department for Work & Pensions is conducting a review into annuities which is due to be completed towards the end of this year so it remains to be seen whether there will be any progress on this issue.

In other top annuity news, Annuity Direct managing director Stuart Bayliss says rates have reached their highest level for four years and says this is due to a substantial increase in long-term gilt and bond yields.

But Aspen annuities director Billy Burrows says he does not expect the trend to continue after the market crash last week.

And finally, Aegon’s Rachel Vahey says public sector pension provision is the “last taboo” facing the Government.

Vahey says the Government was able to raise the state pension age without so much as a murmur but that any efforts to reform public sector pensions will meet with a lot more resistance.

On the life front, Royal London and Royal Liver announced yesterday that their merger talks had been terminated.

Royal Liver said it felt the interests of its members would be better served by going it alone.

A blow to all those sub-editors who were hoping for great headlines along the “Royal Wedding” theme.


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