Tory shadow chancellor George Osborne’s crusade to position Cameron’s Conservatives as the party of fairness produced an Unfair Britain dossier with some interesting statistics on how he believes Labour is failing pensioners.
The Conservatives say the poorest pensioners stand to lose nearly £100 this year as increases in pension credit are swallowed up by high inflation. It certainly looks like pensions will again be high on the agenda during this year’s political conference season.
Meanwhile, the industry is seeking to meet growing consumer demand for flexible retirement options with Hargreaves Lansdown and Norwich Union the latest to declare a possible interest in producing a variable annuity.
In response to the current weight of headlines about variable annuities, Legal & General laid another alternative on the table this week as it sought to drum up adviser interest in its with-profit annuities.
The insurer believes clients and IFAs will increasingly be drawn to the potential upsides of the product, while benefiting from the smoothing effect on bumpy investment returns and without having to pay for expensive guarantees.
The surge in with-profit bond sales that life offices such as Prudential, L&G and Norwich Union recently reported, is continuing to cause a stir as analysts seek an explanation.
The issue cropped up again at a Fitch teleconference this week on the UK life insurance sector one year into the credit crunch.
Senior director of insurance David Prowse hinted that it might be more of a sales-driven increase than one that is consumer-led.
And was he referring to Hargreaves Lansdown chief executive Peter Hargreaves’ recent comments in Money Marketing when he said: “There have been reports recently of potentially more sinister reasons behind this, such as commission.”
The life offices in question say there has been no particular sales push on the products, but that the smoothing effect on with-profits naturally appeals to consumers in times of volatility.
But Prowse seems unconvinced of the argument claiming it is not obvious why customers should of their own volition choose to buy with-profit bonds at this point in particular as opposed to this time last year.