Providers have responded angrily to Treasury Economic Secretary Ed Balls’ claims that the protection industry suppor-ted the abolition of pension term assurance.
A total of 145 MPs voted against the abolition of PTA at a House of Commons debate earlier this month but the clause was passed, with 262 MPs voting in favour of abolition.
Balls said: “Some in the industry agreed with the approach. An expert at Aegon Scottish Equitable said: ‘Although we understand the ABI’s position, we do not think that its pro-posals are a workable solution for providers or for customers’.”
Balls went on to say it was on this basis that the Treasury decided it could not continue to allow PTA products in the market.
But Aegon spokesman Mark Locke says the statement was taken from Aegon’s response sent to the Treasury, which did say the ABI’s approach was not workable but went on to set out alternatives as to how PTA could be continued as a product.
Locke says: “We did not agree with the Treasury’s approach, so to say that was misleading. These comments were taken out of context.”
Hargreaves Lansdown protection research manager Jon Briggs says it is cowardly for Balls to blame the industry for the scrapping of PTA by misinterpreting its responses. He calls the debate “democracy with hindsight”.
The Commons’ debate saw Conservative Shadow Chancellor George Osborne, LibDem Shadow Chancellor Vince Cable, former Tory leader William Hague and Tory MPs John Redwood and Sir Malcolm Rifkind vote against the abolition of PTA.