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Review work at a halt as FSA delay drags on

IFA networks are complaining that they have departments sitting idle

because the FSA is making them wait a year for a pension review

recalculation.

The regulator withdrew a formula relating to some transfers in phase two

of the pension review last autumn, saying it was wrong.

Industry sources say they were led to believe that the correct formula

would be issued in the spring. Now the announcement has been delayed until

September, even though the FSA says it want the pension review dealt with

quickly.

DBS complains its pension review department, which costs it £150,000 to

run a month, has been hamstrung by the delay.

Chief executive Tony Kempster says: “We know the PIA is working hard to

resolve the issues on Factor X. Our planning assumption is that the problem

will be resolved by September. If the PIA can improve on that we shall

welcome an earlier resolution.”

Rival network Misys says the hold-up is an “inconvenience”. It says it is

doing as much as work as possible without the formula.

FSA spokeswoman Sarah Modlock says: “We said it will take several months

to sort out. We did not restrict ourselves to a date when it would be put

out.”

Law firm Reynolds Porter Chamberlain partner Jonathan Davies says: “The

FSA is causing the delay. The hold-up could be actuarial or legal.

Bulletins seven and eight led us to believe that the recalculation would be

in the spring.”

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