It was most interesting to read an article entitled, Higher fees for low-cost savings plans' on the front page of the Financial Times Weekend edition of June 12/13 in respect of the planned increase in the charge cap to 1.5 per cent.
One of the quotes from a product provider was: “We would have preferred an initial charge. It doesn't do enough and won't make a great deal of difference in expanding the market.”
Further on, in the money section of the same issue,I read the article on child trust funds where the maximum charge has also been set at 1.5 per cent.
The same product provider was quoted with other providers as saying that 1.5 per cent is still too low and they do not plan to enter this market.
Who is this product provider? Would you believe, Legal & General? The one (and possibly the only one) that was adamant from the outset that it could market stakeholder pensions at 1 per cent.How amusing.
Partner, Finmor Associates