Suffolk Life director of sales and marketing John Moret never thought he would see the day when Sipps were splashed on the front page of national newspapers but last year he did.
The 58-year-old character, dubbed “Mr Sipp” by the industry, has been involved with self-invested personal pensions through the ups and downs of their 17-year existence. Moret is excited at the recent wave of interest which has raised the profile of Sipps and brought a rapid increase in sales of the pension product that he deems to be the best option for most of the population.
“I predicted in 1999 that there would be half a million Sipps by 2010 and people thought I had lost my marbles because there were probably about 50,000 Sipps then, if that, but it is still very much on the cards. There are probably 180,000 now and it is growing fast.”
Moret was working at what later became Winterthur Life when the company was pipped at the post to launch the first Sipp product in 1989. But it has only been over the past two years, since Moret joined Suffolk Life, that people have sat up and taken notice of the product. In this short time Suffolk’s business has doubled. Mr Sipp believes the pre-A-Day hype about what would and would not be a taxable investment made many people aware of how a Sipp could help them reach their retirement dreams.
“Suddenly people have woken up to the fact that all you have is a tax wrapper and investments and all the Sipp does is provide tax advantages and the widest possible range of investments, so why wouldn’t you have that?
“The only reason would be if it is too expensive and that is certainly an issue at the moment but I do think we will see prices fall over time. The middle ground has almost evaporated so you have stakeholder pensions to one side, possibly to be replaced by the national pension savings scheme, and then arguably Sipps as the solution for everybody else.”
The self-confessed tennis fanatic whose technique took him to the revered courts of Wimbledon last year – although, admittedly the only spectators were his wife and his opponent’s wife – believes that the debate on whether residential property should be a non-taxable pension investment was especially important in getting Sipps into the press.
Moret thought the Government’s last- minute U-turn would put people off Sipps altogether but intriguingly the opposite occurred. He knows first-hand what a nightmare residential property would have been as a non-taxable investment, particularly overseas property, as he has spent a nightmarish two years trying to buy a villa in Spain.
He says: “The media attention did an enormous amount of benefit to the brand that no advertising campaign could ever possibly have achieved. It would have been mayhem if it had gone ahead so I think w got the best of both worlds. We got the hype without the hassle.”
Moret believes the fact that you can now, since A-day, roll non-pension assets and investments into a pension to maximise tax relief benefits could present a poten- tially huge new market.
“If you have a portfolio of shares or an Isa portfolio, you will now be able to move those either in block or over a period of years into a Sipp and get tax relief because it would be treated as a contribution.
“Some big stockbrokers have got hundreds and thousands of high-net-worth clients and in the main they have only dabbled with Sipps. The investment houses and investment managers could be a huge influence on the shape of the market and that could be bad news for advisers or it could be good news, depending on whether the advisers have good relationships with the stockbrokers or not. I think over time we will see simplification change the pace at which people fund their pension as a pension.”
In April 2007, Sipp providers, which until now have not had to follow uniform guidelines, will be regulated by the FSA. Moret believes regulation will lead to consolidation and a more level playing field.
“At the moment, the regulation of Sipps is a bit of a dog’s dinner. You have some providers like us that are fully regulated because we are a life company but the Sipp market has developed in an uncontrolled way so you have some companies that are totally unregulated and some that are sort of regulated for certain activities.
“It is all a bit of a mess and I think that, given the growth and interest in Sipps, it was inevitable that the FSA would have to do something. For the investor, it certainly provides another level of comfort and security but it does pose some challenges, particularly for smaller providers. But by and large, regulation is a good thing.”
Moret is a non-executive director of the Salisbury Playhouse and finds it interesting to observe the artistic side of production mesh with the commercial side. He is looking forward to travelling when he retires and I imagine, as the one and only Mr Sipp, he has a damn good pension in place.
Born: Surrey, 1949
Lives: Hampshire/Wiltshire border with wife Julie
Education: BSc (Hons) pure maths and stats, UCW, ALA.
Career: 2004-06: director of sales and marketing, Suffolk Life; 2000-04: managing director and then executive chairman Personal Pension Management (PPML); PPML sold to Capita 2004; 1986-99: director of sales and marketing at Provident Life, then Winterthur Life; 1970-83: actuarial trainee Sun Life
Likes: Family, playing tennis, supporting Crystal Palace, theatre (non-executive director of Salisbury Playhouse), Spanish climate and wine, meeting interesting people
Dislikes: Politicians, internal politics, bureaucracy, poor service, people who can’t be trusted
Drives: Monaco blue BMW 730d
Favourite film: One Flew Over the Cuckoo’s Nest
Favourite book: Playing the Moldovans at Tennis, by Tony Hawks (it’s not quite as you’d imagine)
Favourite musicians: Tina Turner, Rod Stewart
Heroes: Bjorn Borg, Arthur Ashe
Career ambition: Have fun and see what happens
If I weren’t an IFA, I would be… A professional tennis player (no harm in dreaming)