As well as shining a light on where the industry needs to improve, I hope the thematic review will also result in some more straightforward guidance being issued – both for providers and customers – on what a Sipp is and what an investor can and cannot do with one.
The whole of the Sipp industry is crying out for clearer communication from the regulator and precise guidelines on good practice.
Without fail, at every pension conference I attend there is at least one person demanding the return of an approved investment list. Handled right, a simple and clear document would be a great help to the whole industry, and a positive step forward for Sipp clients.
Much of the current confusion stems from the replacement of the old permitted investment list by the Registered Pension Scheme Manual. The compendious manual is open to interpretation, and as a result has led to the current muddled position on non-standard investments. It often confuses as much as it clarifies.
In its initial capital adequacy paper, the FCA outlined its thoughts on what it considered to be “standard investments”. I would now urge it to build on this good start, and use the review as an opportunity to set out some more concrete investment principles for the industry.
This will be a huge help for both Sipp providers and the growing number of clients who are keen to use a Sipp to take more active charge of their pension planning.
John Fox is managing director of Liberty Sipp
