View more on these topics

King claims pensions have not been hit hard by QE

Bank of England governor Mervyn King says claims that quantitative easing has caused significant damage to pension funds are exaggerated.

According to the Telegraph, King told the House of Lords yesterday that the fall in the value of pension funds is not down to the Bank’s £325bn QE programme.

He said: “I am concerned about what has happened to the pensions industry and defined benefit pensions but I think they reflect a wider set of issues. The decline cannot be laid at the door of our programme.

“It might not have had quite such as big an effect as some people think.”

In February, the National Association of Pension Funds warned that QE will push up pension fund deficits, causing more employers to close defined benefit schemes.

NAPF chief executive Joanne Segars said the monetary policy committee’s decision to pump an extra £50bn into the QE programme in February increased pension fund deficits by £45bn.

She said: “This short-term stimulus is leaving pensioners and pension funds in long-term pain. Our fear is that firms struggling with a weak economy will simply choose to close their pension schemes.

“We think the last hit of QE increased pension fund deficits by around £45bn, and the latest tranche will only add to that bill.”

King refused to rule out an increase to the QE programme.

Minutes from the MPC’s March meeting show the nine members were split 7-2 over whether to increase the size of the programme, with David Miles and Adam Posen voting to increase it by £25bn to £350bn.



Complaints about mortgage firms up 76%

The number of complaints about mortgage businesses, including brokers, rose 76 per cent in the second half of 2011 to 52,746, up from 29,917 in the first half of the year. The FSA’s latest complaints data, published today, shows 47 per cent of complaints, or 25,687, were upheld in favour of the consumer, compared to […]

Martin Churchill: Tax-efficient briefing

A number of VCTs have launched linked tender and enhanced buyback offers. These allow investors who are interested in committing to being invested for a further five years to effectively swap out their current holding for new shares on which they can claim the up front 30 per cent income tax relief. This is not […]

Qrops must offer same deal for residents

HM Revenue & Customs has published new rules on Qrops which confirm that schemes must provide the same tax benefits to residents as non-residents. Final rules published by HMRC last week include req-uirements previously known as Condition 4, which mean Qrops providers must treat non-residents and residents of a jurisdiction in the same way for […]

OECD: UK heading back to recession

The UK will have returned to recession by the end of the first quarter of 2012, according to the Organisation for Economic Co-operation and Development . In its latest Interim Economic Assessment, the group predicts that the UK economy will contract by annualised 0.4% over the opening three months of 2012. This follows the annualised […]


News and expert analysis straight to your inbox

Sign up


There are 4 comments at the moment, we would love to hear your opinion too.

  1. I disagree that it has a negligible effect on annuity rates. It has had an effect.

    He does not really need to worry for himself on such matters.

  2. I often wonder what world our regulators and Government Ministers live in. When NAPF Chief Exec states the QE has caused great damage to pension funds and annuity rates are at there lowest ever caused b QE those in power ignore the professionals I wonder if it is because they dont have to worry about pensions because theirs are gold plated

  3. No fool like an old fool!

  4. The BoE have been robbing the taxpayer blind with their gold-plated £2.5 billion pension fund -equivalent to a 60% employer pension contribution – that they do not pay into themselves. Please sign the petition to return this back to the taxpayer –

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm