We’re seeing a contraction in the number of what historically would have been called the bespoke end of the Sipp market. Most of the M&A activity has been around smaller providers; growth prospects there are limited.
With capital requirements, less providers are prepared to contemplate non-standard investments because they are labour-intensive. There are risks but equally there are some cracking opportunities.
There is consultation going on to find a way of allowing investment in crowdfunding space through an Isa. Try doing that with a Sipp.
We need more flexibility. Balancing flexibility with risks is going to be a challenge.
Clearly, the growth in Sipps has been driven by platforms. Now, the majority of individual pensions are set up as Sipp.
It’s wrong to assume that all Sipp investors are well informed. About 20 per cent is probably non-advised.
My perception of platforms is that until the Budget last year, most had ignored decumulation. They focused on technology-driven solutions for accumulation.
All of a sudden they realised that’s not the end of the game. It’s just a new game starting, which needs technology. There’s a huge amount of work to be done there. That’s never going to be ready for April.
Only a relatively small number of advisers that have got the later life qualification. Increasingly this is going to be an issue because, as you get older, the ability and desire to take investment decisions diminishes and it’s that transition that’s going to be crucial in the new environment.
My fear is the landscape is going to get increasingly more confusing. I believe the majority will act sensibly, but there will be a minority who make absolutely crass and disastrous decisions.
If you wind the clock back to A-day and pensions simplification, that kicked off in 2002 with Pickering and it was four years before it came in. Even then there were last minute U-turns. This has all been done in under a year so there will be consequences.
I am confused around short term and long-term savings policy. I don’t understand how we can be encouraging people to save in Isas, when there is still no connection between that and longer-term savings.
The tax regimes are totally different. It will be a big pill to swallow, but I would be amazed if in five years time the tax regimes for pensions is the same as it is today, regardless of who wins the election.
The average individual is not saving enough via a pension to provide for themselves even at a minimum level in retirement. Unfortunately we are in a situation where there are the haves and the have nots and solving that is beyond me.
The jury is still out on auto-enrolment. The stat that was compelling to me is, by members, about 50 per cent of employees are auto-enrolled, but by employer it’s about 3 per cent. Getting those 97 per cent over the line will be a challenge.