20 March 2008
Watson Wyatt has warned employers of the potential pitfalls of
group self-invested personal pensions (SIPPS) advising them to take
special care when choosing their plan.
Will Aitken, senior consultant at Watson Wyatt said: "There is
no doubt that helping employees use the tax advantages of pension
contributions is a very appealing way of enhancing the value of a
ShareSave arrangement. But much thought needs to be given to the
specific provider used to collect the contributions. We are not
convinced that all of the entrants to the immature Group SIPP
market are wholly committed. Some seem to be entering the market
because they feel they should, rather than because of any strategic
belief in the Group SIPP market."
Mr Aitken added: "Employers considering this route should ensure
they undertake a thorough review of the provider market - rather
than just opt for the first one that comes along - and ideally meet
with a shortlist of providers in a beauty parade exercise in order
to understand fully what they can offer."
