Perspective: Don’t ‘chase shadows’ with auto-enrolment

Advisers will be provided with a range of opportunities in the corporate sector as a result of the introduction of auto-enrolment later this year, but many could find themselves “chasing shadows” if they do not take a “discliplined” approach, according to IFA group Perspective.

Peter Craddock, group operations director of the national advisory firm, spoke to FTAdviser following the release yesterday (20 December) of a report from the Pensions Regulator, which revealed that only four per cent of companies would be willing to pay for an IFA to help them choose or set up a pension scheme.

Mr Craddock said that despite this, the introduction of auto-enrolment would still be positive for the advisory sector, as the increased awareness of pensions issues it will promote will create an opportunity for those “skilled in this area” to make contacts and generate business.

He warned, however, that anyone seeking to move into this space would need to be “very disciplined”, saying that it would be easy to end up spending time “chasing shadows”.

In particular, Mr Craddock said that generating business in the corporate sector was about relationship building, describing it as a “courtship” that is “long drawn out and all about showing your expertise”.

While he said he was realistic about the affect of auto-enrolment for many smaller employers - “some employers might see this as a tax and might even advise their employees to opt-out” - Mr Craddock said that many will want to seek out alternatives to Nest and some may even look to employ an adviser that has impressed them to help with their own personal pension needs.

He said: “This will give advisers skilled in this area an opportunity to get in front of senior figures and finance directors and demonstrate their abilities to them. There are all sorts of options out there for those in older occupational schemes.”

Mr Craddock said that the key for advisers was to ensure that they got on firms’ radar, suggesting that they seek to proactively build corporate contacts and contribute thought leadership articles on the subject “to local newspapers and relevant trade magazines”.