A-Day changes to transfer values could cost occupational pension schemes 430m a year and lead to more schemes being closed, warns Killik & Co.The financial planning firm says a little publicised part of next April’s rule changes mean that employees who leave company schemes must be offered a transfer value or deferred pension, provided they are more than a year away from normal retirement date and have more than three months service. Under current rules, employers do not have to offer transfer values or refunds to any employee who leaves with less than two years service, meaning they can claw back contributions made on behalf of the ex-employee. The rule change means this clawback period is reduced from two years to three months, which Killik & Co has calculated as potentially costing schemes 430m a year. Director of financial serv- ices Malcolm Cuthbert says the change will accelerate the move away from defined-benefit schemes towards stakeholder and Sipps. He says: “Not every occupational pension scheme currently takes advantage of its right to claw back contributions made for a member so these schemes will not be hit by the new regulations but the fact remains that a number of schemes do reclaim earmarked money and these schemes will find the new regime very costly.”
An EU green paper has str- ongly criticised the state of the Ucits regulations but has ruled out an immediate overhaul of the regime. The paper – part of an on-going review of cross-border funds headed by EU internal market commissioner Charlie McCreevy – says Ucits regulations do not allow the full potential of the […]
FundsNetwork has dramatic-ally ditched Norwich Union as its investment bond partner in favour of rival Standard Life amid concerns over NU’s admin. The fund supermarket says Standard will now provide both the platform’s investment bond and Sipp wrappers, taking it some way to offering a full wrap service. FundsNetwork, which was denying the move as […]
Credit Suisse has announced details of its multi-manager Incubator fund to launch on July 25.It will aim to take significant stakes in funds less than 100m in size, hoping to capitalise on early growth.The fund will be managed by Gary Potter and Robert Burdett and be capped at 75m. It will invest in three main […]
Preferred announces new two year fixed rates with no extended tie-in plus changes to its existing product range.The new two year fixed rates are fixed until September 1 2007. Rates start from 6.19 per cent verified and 6.44 per cent self certification on near prime.The relauch of the three year fixed rates have no extended […]
The default retirement age (DRA) was abolished more than three years ago, yet new research from Jelf Employee Benefits suggests that the vast majority of employers still have some way to go to fully understand, comply and communicate the landmark legislation change that prevents older employees being forcibly retired on the grounds of age alone.
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True Potential’s discretionary portfolios have attracted £2bn in the past year, with inflows up 200 per cent. The firm has announced that the 10-strong suite of funds are currently seeing daily inflows of £10m, with the range now holding £3bn in assets under management. The figures have been released as model portfolios come under the […]