Rival firms should axe exit fees to help unlock SSAS potential

More firms should axe exit fees and increase their transparency as part of measures to boost SSAS and unlock the market’s potential, a pensions specialist says. Mark Canning, an AMPS technical committee member, said many players in the pension market view SSAS “somewhat nervously” – despite a renaissance over the last 12 months thanks to the pension reforms.Mr Canning, head of business development at Yorsipp, told Sipps Professional: “It appears then that some structural changes may be required if the industry is to fully harness the potential that the SSAS market offers.“These changes should hopefully provide some comfort that SSAS is not a ‘toxic’ last resort for dubious assets and liberation schemes.”The former Aegon UK and Hornbuckle employee identified the removal of the mandatory Pensioner Trustee function in 2006 as a key reason.Mr Canning, who has acted as a Pensioner Trustee himself, wants to see this policy reversed, saying: “Many of the ‘take-over’ requests we see for SSAS come from schemes that have disposed of their Pensioner Trustee post A-day and since encountered difficulties.“Should such a move be taken, HMRC could then publish the approved Pensioner Trustee list which should hopefully help both give comfort over the validity, and also improve the speed, of transfer requests.”Mr Canning called for rival SSAS businesses to follow Yorsipp’s move to cut exit fees, saying they have led to a number of “trapped” clients in poorly administered, high charging plans.He would also be in favour of SSAS providers having to publicly disclose the types and quantity of assets held.He said: “This transparency would help both clients and advisers determine the level of risk attached to placing business with that provider. For example, what would said provider’s position be if the same Sipp capital rules were to be applied - which down the line I don’t believe is out of the question.”Among the problems in the SSAS sector he identified were that HMRC’s fit and proper person test, designed to act as a scheme administrator, “hasn’t always served as well as one might have hoped”.He believes that many smaller providers have had difficulty securing banking arrangements because there has often been no ‘regulated’ entity which gives the banking community the due diligence comfort they require.

Rival firms should axe exit fees to help unlock SSAS potential

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