View more on these topics

On Commons ground…

In a recent poll commissioned by BB Radio 4 to find the most despised profession,MPs and Government ministers topped the hate list.

Despite this, Robin Cook,in the past few weeks in a submission to the committee on standards in public life, contended that MPs should be permitted to continue self-regulation.

Apart from the sleaze, accepting donations from dubious sources, cash for questions and substance being subordinate to style and spin, you are forced to concede that they are a fine body of people doing a magnificent job. After all, who has drawn attention to the very grave savings deficit in this country, one of the six major issues facing the nation today?

Well-intentioned words, however, are short and easy to speak but their echoes are truly endless. Isas, with an annual allowance of £7,000, replaced by Peps and Tessas. The former had a maximum contribution of £9,000 and the latter an annual average contribution over five years of £1,800.

The public were “encouraged” to contribute even more into their pension schemes in return for the same benefits, with the abolition of the tax dividend tax credit.

Taxation now swallows more of the typical pension than an adviser&#39s commission or management fees.

In a perverse move, the Government introduced the minimum income guarantee for pensioners of £98.15 a week. Presently, the average lump sum to purchase an annuity is £25,000. This returns an inflation-proofed income of £1,200 a year for a man aged 65. A woman aged 60 would need more than £41,000 to obtain an annuity income of £1,180, rising in line with average national earnings.

If they save nothing at all, the state will provide the extra income that the above pension funds could provide, so why bother? In addition, we need simplicity in retirement planning instead of constant changes and increasing complexity.

Frank Field made sensible proposals on how to proceed from here but the Government binned them immediately as they want a magical, painless solution.

The tax changes have endangered many final-salary schemes but there is one that is not under threat – that of the MPs themselves because it is funded by you and I, the taxpaying public. An actuary recently calculated than an MP&#39s pension would cost more than £630,000 to buy in the private sector.

If you are considering a change of career, then you do a lot worse than to look no further than the House of Commons.

Gerard O&#39Boyle

Anstey Financial Planning,

South Molton

Devon

Recommended

&#39Slashing protection rates is a competitive illusion&#39

Aegon Individual Protection has slammed rivals which slash product rates to boost short-term market share, claiming these tactics are a competitive illusion which sell IFAs short. Managing director Janet Wyles says companies in the protection market which regularly reprice their ranges to gain a competitive advantage are failing to provide IFAs with relevant products which […]

Teather & Greenwood Investment Management – TGIM Ethical Fund

Friday, 14 June 2002 Type: Oeic Aim: Growth by investing in socially responsible UK equities Minimum investment: Lump sum £1,000, monthly £100 Investment split: 100% in socially responsible UK equities Isa link: Yes Pep transfers: Yes Charges: Initial 3%, annual 1.5% Special offer: No initial charge Offer period: Until July 8, 2002 Commission: Subject to […]

Legal threat from class actions on split-caps

A thirst among investors for class actions in the wake of the controversy surrounding split-capital trusts could cost the industry dear, warns City law firm Eversheds. The warning comes as some law firms have been soliciting groups of people with similar claims to take action against fund managers and IFAs over claims of high gearing, […]

UBS Global Asset Management – Managed Fund

Tuesday, June 11, 2002Type: OeicAim: Growth by investing in equities, bonds and cashMinimum investment: Lump sum £1,000, monthly £50Investment split: 100% in equities, bonds and cashIsa link: YesPep transfers: YesCharges: Annual 1.5%Commission: Initial 3%, renewal 0.5%Tel: 0800 5872111

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    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

    Email: customerservices@moneymarketing.com