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‘Life offices created the savings gap’

Financial advisers that rely wholly on group personal pension business might as well sell up now because of the threat posed by personal accounts, according to Syndaxi Financial Planning managing director Robert Reid.

At a panel debate at the Money Marketing Retirement Summit in Nice this week on the impact of personal accounts on the group pension market, Reid said: “If all a firm is doing is GPPs, then if they have a chance to sell it they should do so now.”

Panellists, including Hornbuckle Mitchell managing director Neil Marsh and Red House director Gareth Marr, called on firms reliant on GPP business to branch out into group Sipps and SSASs to differentiate their propositions.

Marr blamed insurers for creating the need for pension personal accounts because of their inability to sell pensions as a concept.

He said: “It is ironic that life offices have been bleating on about the savings gap when they helped create it because they do not know how to sell pensions.”

But Bankhall chief executive Peter Mann said it is not the life companies’ job to encourage people with no money to save and he rejected personal accounts as “a fruitless exercise”.

He said: “There is a constant pursuit of a Nirvana that does not exist. It is a fruitless exercise trying to make people to save when they do not have the money or the inclination. This is not the function of life offices or the Government. This is a fact of life.”

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