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CBI dismisses auto-enrol levelling down concerns

Just 1 per cent of the UK’s largest employers plan to level down pension contributions for existing members as a result of automatic enrolment, research from the CBI and Towers Watson suggests.

A survey of CBI members found 80 per cent of employers have discussed how to comply with the new regulations, which come into force from October next year, at board level.

Some 61 per cent of respondents say they expect to enrol defined-contribution scheme members on their existing terms, while only 1 per say they will cut back employee pension provision.

CBI chief policy director Katja Hall says: “Our survey shows a heartening level of readiness for next year’s pension reforms among firms facing the change, with less prepared firms typically those who will not be enrolling staff for several years to come.”

Towers Watson head of UK pensions consulting John Ball says: “Although firms with fewer than 3,000 employees are being given longer to comply, it’s full speed ahead for the largest employers.

“Planning is generally well under way but the detail of the legislation holds some hidden surprises. This is a major project which employers can’t afford to leave to the last minute.”

Employers also raised concerns over the Government’s plans to abolish contracting out for defined-benefit schemes as part of proposals to introduce a single-tier state pension for future retirees.

Hall says: “Abolishing the contracted-out rebate in defined benefit schemes will significantly raise national insurance contributions, so the CBI is calling on the Government to offset these costs for employers and employees, otherwise more DB schemes could be forced to close.”


Friends Life hires LV= fixed income team

Friends Life has made its first hires for its recently-launched asset management business with the appointment of the former LV= fixed income team. The new hires at Friends Life Investments, which is due for launch in the second half of 2012, will oversee its fixed income portfolios. The team, led by Michael Wright, includes John […]

Sanlam acquires client bank of London-based adviser firm

Sanlam Private Wealth has acquired the client bank of London Asset Management. LAM has £44m in assets and over 1,000 clients based in London, Home Counties and Devon. No LAM staff will join Sanlam. The fee paid by Sanlam is undisclosed, LAM clients will now be advised by Sanlam’s Financial Planners while LAM chairman Richard […]

Swip launches European high yield bond fund

Scottish Widows Investment Partnership has launched a European high yield bond under the management of Steve Logan and Lesley O’Neill. The fund will be managed along a best ideas approach with Logan and O’Neill targeting a portfolio of around 75 stocks. In addition to a European bias, the fund will also tap into ideas from […]

A tough start for 2017 consensus trades

By Kacper Brzezniak Every year, starting around November, investment banks (and fund managers) begin to drip out their outlooks for currencies, rates, economies, you name it, for the following year. The consensus has been largely wrong for the past four or five years; those multiple rate hikes never came, the bond market is still alive […]


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