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Small IFAs could face paying bill for review over Serps

Big IFAs are likely to opt out of the PIA&#39s proposed scheme for

recalculating phase two transfer cases under the pension review, leaving

small firms to foot the bill.

Companies such as RJ Temple are not affected by the PIA&#39s decision to

re-open cases to calculate the Serps adjustment bec-ause they did little

pension business and they are unlikely to pay a levy tow-ards the scheme.

The proposed scheme will be voluntary and life offices and IFAs which

think they have the resources to complete the recalculations themselves by

the December 2002 deadline are unlikely to contribute.

Only small IFAs and bigger firms with a significant number of cases are

expected to pay the levy for the PIA to handle the recalculation.

RJ Temple says most of its business was investment so the scheme is not a

concern.

Aifa public affairs director Tracy Mullins says: “Cost will be more of a

problem under this sch-eme than the PIA&#39s first proposals, especially for

small firms.”

An FSA spokesman says: “The scheme offers huge benefits for IFAs who will

be able to claim back 85 per cent of the redress.”

IFA Best Advice consultant Tony Moss says: “I am not in favour of smaller

practices carrying the burden.”

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