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Product Matters

Standard Life has been quite adept at

rein venting itself over the years. In the 1970s, final-salary scheme business; in the 1980s, it was endowments; in the 1990s it was money-purchase pensions, now in the new millennium it is turning itself into an admin company. The industry&#39s answer to Madonna?

The launch of the Standard Life Sipp sends a clear message about where Standard is going. It is placing its bets on being better at running pensions than anyone else. Its group pensions are already better than most of its competitors, many of whom are useless, so the strategy makes some sense, provided they get the Sipp right.

It seems to have done quite a good job. The Sipp pushes all the right buttons, including property purchase, drawdown (including protected rights), family Sipps for the alternative secured pension, direct access to a stockbroker and the Sigma fund supermarket platform for a simplified menu of externally managed funds.

The commission options look sensible, offering fund-based commission up to 0.5 per cent, initial commission up to 5 per cent and funded initial of up to 3 per cent. This latter option is paid for by an additional 0.2 per cent AMC for every 1 per cent of commission for the first six years of the policy.

The charges look competitive against other full Sipps in the marketplace. They do depend on the amount the client has invested through Sigma, though, which might end up distorting the fund choice selections. The only doubt in my mind is whether the Standard Life Sipp will compare well against some of the low-cost Sipps.

Tom McPhail is head of pensions research at Hargreaves Lansdown


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