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Standard questions scheme admin role

Product providers which do not take on the role of scheme administrators on their packaged pension products after A-Day must justify their annual management charges, says Standard Life head of pensions policy John Lawson.

He says Scottish Equitable’s decision not to assume the newly created roles of scheme administrator or authorised scheme practitioner means that clients will continue to pay the same charges for a reduced service.

Scheme administrators face onerous reporting requirements and can face fines from the Revenue if any filing is late or incomplete. The lesser authorised scheme practit- ioner role involves reporting duties to the Revenue but not to members.

Standard has to take on the role of administrator as 70 per cent of its EPP and Cimps’ business is written under a centralised trust of which it is the trustee. For the remaining business, it will act as an authorised scheme practitioner.

Skandia also runs a centralised trust and pensions marketing manager Billy Mackay says clients may switch providers to avoid becoming a scheme administrator.

Lawson says: “What exactly are Scot Eq doing for the annual management charge and other fees they are taking? Why has a product that was sold as a packaged service suddenly become self-administered?”

ScotEq pensions development manager Rachel Vahey says: “Scheme administrator is a whole new role with new responsibilities created by the Revenue. We still admin- ister the scheme so we do not change what we have been doing. We are concentrating on making these responsib- ilities clear.”

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