Sipp investors could have the final cost model confirmed by Hartley Pensions by this month, according to administrators.
In an update to Sipp clients, published today (October 11), administrators UHY Hacker Young explained that it is due to meet with Sipp client representatives this week to decide what a cost model could look like for investors.
The administrators said following communication back in July, a number of clients came forward to become representative respondents and the joint administrators have agreed to appoint six.
It stated: “The joint administrators consider these clients to be appropriate for the role of representative respondents as they represent a wide variety of the Sipp schemes, asset holdings and value of assets held.”
Court application
UHY Hacker Young previously told investors it would apply to court to ratify an ‘exit and administration’ charge that the administrators would make against the assets clients hold within their Sipps.
This will replace the current annual management fees Sipp clients are being charged and will enable them to eventually transfer out.
It is expected that the court application will be issued in November.
The cost models proposed by UHY, previously included:
- Fixed fee per client model – This model is a fixed fee for all clients regardless of the type(s) of asset held or value of their Sipps.
- Hybrid charge based on asset type model – This model is a different charge for each type of asset held within a client's Sipp.
- Percentage based model on the total value of the assets under administration model – This model will charge a percentage on the value of the assets in a client's Sipp; and
- Capped percentage charge – This model will charge a percentage on the value of the assets within a client's Sipp subject to a cap to be determined.
But since meeting with the representatives it has been decided that only the fixed fee per client model and the hybrid charge based on asset type model will now be considered.
The administrators stated: “A further meeting is arranged with the representative respondents for 12 October 2023 where it is anticipated that a final cost model will be agreed between [...]. You will be updated once a final cost model has been agreed but you are able to find further information relating to this on the portal.”
Elsewhere, the representative's have nominated FS Legal Solicitors to advise them in relation to the proposed costing models court application.
FSL sat on the GPC Sipp and the Harlequin Property creditor committees and specialises in financial services law and practice.
In order to be able to canvas opinion and to explain the process, FSL have set up a secure client portal for the 17,000 Sipp holders.
In August, FTAdviser reported how Hartley Pensions' administrators asked all vulnerable pension clients looking to transfer out to sign a non-disclosure agreement to allow for “confidential discussions”.
As it stands, clients of Hartley Pensions are able to draw down money from their pensions in the usual manner. They can also trade investments and request their pension commencement lump sum.
The only restrictions in place are that no further contributions can be made to client Sipps, and that the administrators are unable to facilitate transfers out at this time.
Transfers will only be allowed once the exit and administration charge is ratified by the courts, in order to “ensure all clients are treated fairly”.
amy.austin@ft.com
