Well, what a week that was. On Tuesday morning, Misys ann-ounced an agreed
bid for DBS Financial Management, bringing considerable technology savings
for product providers and real hope for a truly outstanding, fully working
IFA quotes and service portal within the next 12 months or so.
It will be great to work closely with Ken Davy and his team to enhance the
position of all 27,000 IFAs within the financial services profession in
conjunction with Aifa.
On Thursday, I managed to get to Ladies Day at Ascot, thanks to the
hospitality of Shirley Smith at Zifa. Ian Thorneycroft from DBS was there
and I was delighted to hear that his Jaguar, which you may remember was
reported in this paper a few weeks ago as stolen from a garage forecourt in
Huddersfield, has been found – in London and 7,000 miles on the clock
later. I suggested to Ian he look to see if they can be claimed as
To cap it all, I went to see Huddersfield Giants Rugby League team play
London Broncos, as a guest of Giants chairman Davy. Ken was very happy at
the end of the day as the Giants managed to secure their first point of the
season after 16 matches and avert a Super League record of 18 consecutive
defeats. A thrilling draw for Huddersfield, bottom of the league, against
London who were sixth.
I thought of this on the journey back from Huddersfield to Oxford as I was
going to discuss final-salary company pensions this week. Between 1970 and
2000, the average life expectancy of a 65-year-old man has increased to
almost 20 years from 15. This means an extra cost for the final-salary
schemes of about 30 per cent. Also, many schemes have had disappointing
investment returns relative to fixed-interest securities over the last
decade, with gilts achieving an average 9.4 per cent a year real while
sterling corporate bonds managed about 10.5 per cent a year. Scheme
surpluses, therefore, were hard to come by.
It is many of our clients' dreams to be able to take early retirement
whether they are saving in final-salary schemes, defined-contribution or
Pep/ Isas. This is becoming more difficult to achieve as someone retiring
now at, say, 55 can expect to live until 85 so 35 working years to support
30 retirement years.
The Government has an issue in the pension arena which it needs to
add-ress. People need to save more, from an earlier age, and be able to
manage how they take their benefits and from what “retirement” age. This
needs careful consultation with the financial services profession and
leading IFAs in particular to help the Government in its aim of health and
welfare for all.
A challenge and one that the capped costs of stakeholder at 1 per cent a
year is not helping, as sales and marketing to the great British public is
needed as much as supposed cost savings. The biggest cost will be companies
and employees not getting the professional advice they need.
I bring it all back to the stories about Misys and DBS. People like Ken
Davy and myself, as past president of the LIA, care deeply about the
profession we are in. Now, more than ever, is a time to assist advisers to
be able to effectively and efficiently supply quality advice to individuals
and companies. The competition or challenge is in getting the right
message across to the right people and we all have a duty to do that.
Andrew Bedford is head of marketing at Misys IFA Services