View more on these topics

&#39Give employers role in preventing misselling&#39

The pension misselling scandal could have been avoided if employers had been encouraged to give financial advice to their employees, says Conservative Shadow secretary of state for work and pensions David Willetts.

As the Financial Services Act 1986 did not permit employers to advise staff about their occupational schemes, Willetts says a lot of them did not act when employees transferred to personal pension plans.

He believes employers should be allowed to give advice, which would avoid a repetition of similar misselling.

Willetts believes there is a strong role for independent advice. But where it is not being sought by consumers, he says employers should be encouraged to fill the gap, especially when it comes to the suitability of group pensions.

Willetts says: “I think many people do need independent advice but also employers running occupational pension schemes ought to feel they can offer advice on the schemes they run.

“During the so-called pension misselling scandal, employers could not tell employees about their schemes in case it was seen as giving financial advice without being properly registered. They sat on their hands when they saw employees doing things that might not have been in the employees&#39 best interests.”

The Tories have called for the stakeholder deadline to be pushed back by six months and firms with fewer than 10 employees to be excluded from the requirement to provide a scheme for their employees under the current regulations.

Willetts says anecdotal evidence points towards employers which currently offer occupational schemes simply transferring to a stakeholder and stopping contributing.


Skipton Building Society – Tracker Mortgage 85 Per Cent

Monday, 15 October 2001.Type: Discounted flexible tracker mortgage.Tracker term: Four years.Tracker rate: Bank of England base rate plus 0.85 per cent.Discount: 1.4 per cent off tracker rate for six months.Minimum loan: £5,000.Maximum loan: Up to 85 per cent of valuation subject to a maximum of £1m.Income multiples: 3.5 times principal income plus second or 2.75 […]

Learn pension legalities

Practitioners wanting to polish up their knowledge of the legal framework of pensions can find out more at Practical Pensions: The Latest Legal Requirements, a conference in London next month.The conference will look at issues including the impact of the Equitable Life debacle and Myners report, pension sharing on divorce and stakeholder pensions versus group […]

Unilever and Merrill Lynch lock horns over pension fund

Unilever started its £130m damages and negligence claim this week, brought against Merrill Lynch over the management of its pension fund. Unilever says Mercury Asset Management, subsequently bought by Merrill Lynch, followed a risky investment strategy even though it had been told to invest its pension fund more cautiously. Unilever says Mercury repeatedly failed to […]

PIFC on the buying trail to boost turnover

Corporate IFA PIFC Benefits Consultants is on the acquisition trail in a drive to expand its turnover to £50m by 2005 from its current £10m a year.It has appointed KPMG as corporate adviser, PricewaterhouseCoopers as auditor and Cameron McKenna as its lawyer to consider a range of options on the future of the firm, which […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment