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IMA again slams charge cap as it pushes for retirement Isa

The Investment Management Association hit out at the 1 per cent regime again this week, urging the Government to adopt the idea of an uncapped “retirement Isa”.

In a letter to head of the Department for Work and Pensions&#39 pension simplification review Alan Pickering, IMA chief executive Richard Saunders criticised stakeholder&#39s 1 per cent charging cap for imposing a “straitjacket” on providers within which financial advice could not be incorporated.

Saunders said the Government should instead consider the introduction of a retirement Isa but resist “the temptation to impose maximum charges to investors”.

The retirement Isa would have all the benefits of a regular Isa and would be adaptable for use as a personal pension, employer-based occupational scheme or for topup savings above an occupational scheme.

The product would be des-igned principally with the idea of open-ended mutual funds in mind but it would also allow investment in other funds such as investment trusts and unit-linked life funds.

Saunders also calls for Pickering to undertake a dramatic simplification of the pension tax regime, saying the current system, which was designed in the days of 98 per cent marginal tax rates, has not changed to accept the lower risks in today&#39s environment.

Saunders says in his letter: “Clearly, thought would have to be given how this (the ret-irement Isa) would sit with the stakeholder regime.

“But serious simplification would require unification of the two regimes rather than separate products provided by life and fund companies respectively.”


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Taking care of the Welloffs while the Averages suffer

Open letter to Chancellor Gordon Brown.I am increasingly saddened and frustrated by the continued damage done to the financial services industry by our own regulatory body. It appears that the FSA, like the PIA before them, are guilty of making badly advised and ill-informed decisions about what the British financial services consumer wants or needs […]

New splits row as BFS shareholders reject rescue plan

The split-cap sector was thrown into further turmoil this week as BFS Investment&#39s geared income trust failed to implement a proposed rescue package after breached its banking covenant.The fund, which invests almost entirely in other splits and is one of the most highly geared funds on the market, is owned by many other split trusts.The […]

Forsyth buys in Dubai

Fund research company Forsyth Partners is taking a stake in Dubai-based brokerage Professional Invest-ment Consultants.Forsyth already manages PIC&#39s broker funds with Scottish Provident International and Royal Skandia as well as handling a number of its direct investments.Forsyth will act as the investment management arm for PIC.The alliance is the first step in a long-term plan […]

Creating opportunity out of change

By Denise Wond, marketing manager The buy-to-let market has recently been the subject of a raft of tax changes, all of which make it a less profitable and less appealing proposition for investors. In response, we’ve seen a dip in demand for BTL mortgages and that’s bad news for many advisers who will now be looking […]


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