View more on these topics

Advice is ruled out of equation

Advice has been ruled out of the national personal accounts scheme, echoing Lord Adair Turner’s plans.

Work and Pensions Secretary John Hutton’s plan for personal accounts outlined in the White Paper will follow one of two routes which both remove advice to cut costs drastically and allow for a “light-touch, risk-based and proportionate” regulatory regime.

The Government says it will develop a full employer communications and education package to support the introduction of the scheme and help staff make a range of choices without the need for advice.

Depending on how the Government structures the scheme, these choices will include whether to auto-enrol into the scheme in the first place, choice of provider or administrator, basic choice of investment and whether and when to opt out.

Aegon head of corporate affairs Francis McGee says: “The Government still has to tell us how it is going to help people through these important choices. Do they really think that providing information is enough? It appears to be suggesting this new system can do away with advisers but who better to provide a slimmed-down advice service to complement the scheme, albeit using a new model?”

pensions WHITE PAPER proposalsl A scheme of personal accounts will be introduced into which employees will be automatically enrolledl Employees will contribute 4 per cent of a band of earnings of between 5,000 and 33,000 a yearl Employers to make minimum matching contributions of 3 per cent.

l A further 1 per cent will be contributed by the Government in the form of tax reliefl Employer contributions will be phased in over a three-year period at the rate of 1 per cent each yearl Basic state pension will be linked to average earnings by 2012, subject to affordabilityl Gradual raise of the state pension age to 66 from 2024 for both men and women over a two-year period, with further rises to 67 in 2034 and 68 in 2044l The state second pension will become a flat-rate top-up on the basic state pension by around 2030l Abolish contracting-out for defined-contribution schemes.

l State pension provision should increase over time while the extent of means-testing should be limitedl Reduce the number of years of National Insurance contributions into the basic state pension from the current 44 years for men and 39 years for women to a universal 30 yearsl Re-examination of the regulatory landscape


Halifax urges parents to take up CTFs

Halifax says it has opened 210,500 child trust fund accounts following Government figures that 2,486,000 vouchers being issued to date. Of these, 1,654,000 have been used to open an account – 66.5 per cent of the total. This figure compares with 64.2 per cent of vouchers being used in the period up to February 20 […]

TUC opposes rise in state pension age

The Trades Union Congress has backed linking the state pension to earnings, compulsory employer contributions and a fairer system for women but is opposed to raising the state pension age.

Insight appoints Willis

Insight Investment has appointed Mike Willis as UK small cap fund manager.He will manage Insight’s range of UK small cap funds alongside existing small cap manager, Ed Robinson. Willis will join Insight in July from F&C where he held a similar role.Prior to F&C, he was an investment analyst at Bell Lawrie White in Glasgow […]

Firms face 8bn costs

Company pension costs will escalate by 8bn within eight years if the Government goes ahead with its proposed reforms, says Aon Consulting. It says the national personal accounts scheme will add a further burden on businesses which are struggling under the funding requirements of The Pensions Regulator. Aon estimates that a further 2.3bn in pension […]

Where next for the price of oil?

Having stabilised at around $65 a barrel, many investors are questioning if the price of oil will rise, and when. Richard Hulf provides his view. Richard Hulf, manager of the Artemis Global Energy Fund, sets out his thoughts about how the oil price may move through the next six months. At the start of the […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm