Big IFAs are likely to opt out of the PIA's 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's 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
Aifa public affairs director Tracy Mullins says: “Cost will be more of a
problem under this sch-eme than the PIA's first proposals, especially for
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.”