View more on these topics

Fund firms won&#39t fare well if the 1% cap is extended

It is rare that a trade association leaps to the defence of the Government but that is just what Autif has done over stakeholder.

Autif&#39s director general Philip Warland has hit out at his ABI equivalent, Mary Francis, for criticising the Government&#39s involvement in the product&#39s design.

The division of opinion is hardly surprising. The fund management industry has received concessions over Individual Pension Accounts and avoided much ofthe flak directed at life offices.

On the other hand, Francis&#39 intervention against the Government comes after four years of reverses for her membership, not least in the finalised stakeholder plans.

Warland is right in saying the Government is justified in interfering in the pension industry, given the scale of misselling and loss of public confidence.

But the manner in which the Government has chosen to intervene may only add to the public&#39s woes.

Warland is wrong to accept the very dangerous precedent of price controls,a message reinforced by the fact that most of Autif&#39s own membership feel unable to offer IPAs within stakeholder.

The 1 per cent imposition is a dramatic over-reaction, similar to the Pensions Act brought in to prevent a repeat of the Maxwell scandal but which has depleted occupational pensions&#39 reserves. With stakeholder, the Government may be about to do it all over again in the retail market.

Life offices may be bearing the brunt of Government displeasure but if the 1 per cent diktat is extended, it will help no financial services organisation and that includes fund management companies.

Recommended

Pension show back on the road

Scottish Equitable is taking pensions direct to the IFAin another series of roadshows being held around the UK in November.The roadshows will provide IFAs with the latest pension news and give ideas on new business opportunities.Issues being covered include stakeholder and the new defined-contribution tax regime. State pensions, contracting out and pension sharing on divorce […]

Drawdown IFAs go North

The Income Drawdown Advisory Bureau is opening its first regional office in Northern England.The retirement specialist claims the move reflects the growing wealth in the North. The bureau measured the growing wealth partly by looking at the increase in sales of income drawdown policies, which are traditionally only undertaken by those with at least £200,000 […]

Aim float for Lighthouse

National IFA the Lighthouse Group is to float on the Aim for £20m with a placing of2.5 million shares.The placing, which will start on October 27, will issue shares at 160p, with the proceeds used to accelerate the expansion of the business.Lighthouse has 30 IFAs operating from 11 practices but is aiming to increase this […]

Firms create stakeholder guide

The Chartered Institute of Personnel and Development is joining forces with KPMG to publish a stakeholder pension guide for employers.KPMG is hoping the guide will help increase the current low levels of participation in occupational pensions before the launch of stakeholder in Aprilnext year.The company says the extent of the problem is being highlighted by […]

In Focus Ebola cover - thumbnail

White paper — In Focus: Ebola Virus Disease

Jelf Employee Benefits focuses on Ebola Virus Disease (EVD) and what this means for businesses with operations in West Africa. This will be of particular interest to those with employees either travelling to, or living within, West Africa, the area affected by the most catastrophic outbreak of Ebola to date.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment