The current retail distribution review proposals would leave no advisers left to service workplace pensions, warn leading pension commentators.
Syndaxi Financial Planning managing director Robert Reid and Pointon York Sipp Solutions chairman Geoffrey Pointon believe that the RDR proposals will squeeze out general financial advisers and leave middle-market occupational pension schemes in the cold.
Reid considers the market will be left with professional financial planners at one end of the advice spectrum and primary advisers at the other.
He says: “The biggest threat to workplace schemes and the national pension savings scheme is that nobody is going to be there to deliver the advice.”
Pointon says: “Do we think workplace pensions are going to survive the RDR? The regulator has got to consider how it is going to protect them, otherwise large numbers of people are going to lose out.”
Reynolds Porter Chamberlain pensions solicitor Jonathan Davies says: “There is a concept that the saviour to all problems is generic advice. What caused the endowment problems was not specific IFA-led advice, it was the banks. One can sort of see generic advice as a disaster waiting to happen.”
Richards Jacobs Pension & Trustee Services director Richard Jacobs says: “Most professional financial planners set themselves up to be something above advising on small workplace schemes and will turn away this kind of business.”
Reid says: “The Government has got to accept that there is a cost to giving advice. We are going to end up with a stand-off and no one will want to pick up the tab.
“Employers are the obvious ones to pick up the tab but they are not going to see the benefits of paying for this.”