Ssas providers claim victory as govt opts against £10k levy

There were fears from the industry that this could have spelled the end of Ssas.

Nathan Bridgeman, director of SeaBridge Ssas, said: “A lot of praise should be given to the work of Amps and the Ssas professional trustees and administrators that worked tirelessly to raise awareness, not only writing responses themselves but getting their clients and supporting advisers to write a response.

“It is a victory for Ssas.”

In October the Department for Work & Pensions proposed changes to the levy on occupational and personal pension schemes.

As part of its proposal it set out three different options as to how it could collect the levy and at what level.

The first option was to continue with the current levy rates and levy structure and the second option looked at keeping the current levy structure but increasing rates by 6.5 per cent each year.

But it was the third option which caught the attention of Ssas providers.

The Ssas profession can be quite proud that many Ssas firms stood together to fight off this very real threatNathan Bridgeman, SeaBridge Ssas

This would increase rates by 4 per cent each year and have an additional premium rate of £10,000 for small schemes (with membership up to 10,000) from 2026.

This would have impacted Ssas, whose membership is generally limited to no more than 11 members.

But the government confirmed today it would proceed with option two.

There was an overwhelming majority in favour of this option. Of the 287 responses to the consultation, four responses preferred option one (to keep the rates at the same level for the next three years), 278 responses preferred option two (a 6.5 per cent per year rise) and three responses preferred option three.

Only two responses disagreed with all options proposed.

The threat to Ssas

According to the government, respondents said option three would "take away a vital part of the pension market" through damaging Ssas. 

It was also pointed out this would be counter to the government’s policy of growing small businesses and would, in effect, take them out of the market. 

In its response, the government stated: “The government has reconsidered this option and will not be applying a premium on schemes at this time. 

“The aim of the £10,000 premium was not to penalise Ssas’s or schemes with low membership, more to encourage the best value for money for members.”

Martin Tilley, chief operating officer at WBR Group, said: "The consultation should have excluded relevant small schemes, for the very reason the DWP have now suggested, in the first place. 

"This would have prevented the speculation and damage done to the Ssas market that the uncertainty of the past six months has created."

Bridgeman added: “When action was required the Ssas profession can be quite proud that many Ssas firms stood together to fight off this very real threat. It was a great piece of collaboration getting advisers and clients to take action. 

“Special praise should go to Amps for uniting the profession and coordinating our response and raising awareness through all channels. The profession can be very proud for getting a great outcome for consumers and advisers.”

amy.austin@ft.com