View more on these topics

Blight at the end of the tunnel

Uncertainties surrounding RU64 continue to be a thorn in the side of pension planners.

Life offices are calling for the PIA to clarify RU64 before the introduction of stakeholder to try to bring the pension planning blight to an end.

ABI figures for the second quarter of the year reveal regular-premium pension sales have dropped by 25 per cent to 197,000 from 262,000 and the sale of individual pension policies has fallen by 12 per cent to 301,000 from 339,000.

Industry figures put much of the blame for this drop in sales on IFAs&#39 concerns about the consequences of selling products before stakeholder.

Scottish Equitable marketing director Ken Hogg says:”I suspect the reluctance is on the supply side. RU64 was not particularly clear and I think IFAs and tied agents are concerned. The ABI has tried to clarify the situation but it is the regulator that regulates us, not the ABI.”

“I think the regulator needs to come out and be clear about what was meant by RU64. It is so frustrating that it cannot be a little bit clearer about what it meant.”

Scottish Life head of communication Alastair Buchanan says: “The environment has changed and is now more about stakeholder. The PIA should be revising RU64 and setting out more specific advice so advisers stop avoiding giving guidance to clients.

“It is difficult to build the industry in the way we want when the regulator is inhibiting growth. The regulator needs to be more open about what can be done to allow advisers to be more confident about advising in this area.”

Uncertainty about promoting pensions is not entirely due to RU64 confusion. Stakeholder is still being finetuned and many providers are unable to finalise their plans for stakeholder products.

Zurich IFA pension marketing director Tony Reardon says: “As we get nearer to October, providers will start saying whether they are going to offer schemes. As employers are coming to a stage where they are going to decide what they are doing, the planning blight will come to an end.”

The Government is continuing its effort to encourage pension provision. Social Security Secretary Alistair Darling has announced a new proposal for pension credits which means that people on low and modest incomes can save without fearing means-testing.

ABI spokeswoman Suz-anne Moore says: “People around the threshold of means-testing are reluctant to save as it might affect their benefit. Now they will be rewarded for saving and benefits will not be cancelled out. With the introduction of stakeholder, this should bring new people into the savings market.”

But while this plan isbeing welcomed, it is still just a proposal and confusion will remain until full details of the scheme are confirmed.

Recommended

Charcol will take high-net-worth role in B&B plan

Bradford & Bingley is launching a two-tier advice strat-egy, with John Charcol and CharcolOnline advisers targeting higher-net-worth clients and B&B advisers left to service the mass market.The move is part of a mix-and-match distribution strategy which will see Charcol leading the way in the advice-based strategy.The strategy, revealed to Money Marketing by CharcolOnline managing director […]

Risks and rewards on CD-Rom

Scottish Equitable has developed an interactive CD-Rom to help IFAs advise their clients on the risks and rewards of personal investment portfolios.The Risk and Reward CD-Rom allows IFAs to input clients&#39 investment details which are then assessed against a benchmark portfolio according to a risk profile selected by the IFA. The benchmarks suggest proportions that […]

TUC stake plan offers five funds

The Trades Union Cong-ress&#39s stakeholder plan will offer the choice of two fund managers and five funds with free switching.The plan, which was officially launched last week at the TUC annual conference in Glasgow, has been developed in partnership with Prudential and Standard Life Investments. It is one of the first stakeholder schemes to be […]

Petrol shortage leaves IFAs running on empty

IFA firms have suffered losses running into tens of thousands of pounds following the petrol crisis which swept the country last week.IFAs claim to have been hit hard by the fuel shortage, with clients unable to reach their offices and IFAs having to cancel home visits.Many firms predict they will never be able to recoup […]

Seeking quality in uncertain markets

By Ewan McAlpine, Senior Client Portfolio Manager In uncertain times, investors naturally seek safety. But in fixed income markets, what does that really mean? Ewan McAlpine outlines the approach RLAM’s Fixed Income Team will be adopting across its credit funds in response to potentially volatile markets this year. Click here for full article

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    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

    Email: customerservices@moneymarketing.com