transfer prevention cartel?

jimct

I'd like to transfer a final salary pension from a previous employer to my current employer - "certainly sir" they say at the transferring company. "Just need you to get the receiving scheme to sign our indemnity statement. It's to protect you, in case the government changes the law retrospectively."

Of course, the receiving company won't sign what amounts to a blank cheque but kindly offer to provide a signature on their own indemnity statement "it's practically identical to theirs".

I offer to sign a waiver; I'll give up any future benefits due to "retrospective changes". Nope, can't do that either.

Stalemate. This indemnity statement requirement lark seems to be a dodge to prevent transfers.

Or, have I missed something? Is there a way of making this happen?

dunstonh

Transferring final salary schemes accounted for a great proportion of the pension mis-sales years ago. You are basically asking them to do something that is almost certainly not in your best interests (there are exceptions and you could be one of these but the odds are against it).

You could visit an IFA to do it. They take on legal responsibility for the transaction. However, the IFA will charge you for it and there is a good chance they will refuse to do it if its not in your interests. Especially as its the IFA that will have to pay for the correction. Even if you sign something to say you take responsibility, this will almost certainly be ignored if the case was under review. There is no excuse for doing a transaction that you know is wrong.

You FSA has a track record of retrospective rules changes so you cannot blame the trustees for their caution.

EdInvestor

Hello Jim

Almost all pension schemes are in deficit at present.This means your transfer value will be reduced so that by leaving you will not disadvantage other members by taking more than your share.

If (when) the stockmarket improves, these deficits will probably disappear in the future, and thus your transfer value would be higher.

Therefore it follows that you will lose money if you leave now.

Thus you will not be allowed to leave now.

This indemnity statement requirement lark seems to be a dodge to prevent transfers.
Or, have I missed something?

Looks to me like you've got it in one.

Blame the actuaries: they caused the deficits.

dunstonh

Blame the actuaries: they caused the deficits.

And Gordon Brown for forgetting that stockmarkets go down as well as up. His £5 billion a year tax raid on pension funds has done as much damage.