Two-thirds of advisers concerned about DB scheme viability

Its research found that nearly six out of 10 (57%) specialist retirement advisers believe that client concerns about future DB scheme viability will increase this year, encouraging an acceleration of transfers into SIPPs.

Its recent study also found that 63% of advisers themselves are concerned or very concerned about the on-going viability of some client DB schemes.

Momentum’s research also confirmed the growing demand for transfer advice with over half of advisers (55%) in the nationwide survey having seen an increase in demand for DB transfers into SIPPs this year.

John McCreadie, Head of Sales (UK), Momentum Pensions, commented: “Advisers clearly believe that DB scheme viability is a major issue and so do their clients.

“Recent industry figures valued DB pension liabilities held by small and medium-sized enterprises jumped 7.5 per cent to £4.3 billion in 2016. Low interest rates, increasing life expectancies and rising costs are headwinds for future final salary scheme solvency and are added concerns to retirement advisers and their clients.

“Market data indicates that around £50 billion has been moved from DB schemes by a total of 210,000 members since April 2015. The growth in transfer advice is placing unprecedented demands on advisers who need unwavering support from SIPP providers to ensure the SIPP meets their clients’ future retirement needs. This means robust due diligence procedures, clarity on charges as well as the widest choice of investment options and deep technical support.”