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Private pensions have widened rich-poor gap

Private pension provision has boosted the income of the wealthiest

fifth of UK pensioners to more than three times that of the poorest

20 per cent, a new survey reveals.

Research from the Pensions Policy Institute reveals that the richest

20 per cent of UK pensioners now have an average pension income of

£19,000 a year – 87 per cent of national earnings – with the

poorest fifth on £4,600 – 21 per cent of average national


But the report concludes there is no evidence that future pensioners

will be any better off than today&#39s, with both the state and

employers cutting their long-term commitments and no evidence that

people are making up for this through their own pension or other


The research shows average contributions to non-state pensions grew

as a proportion of average earnings to 7.8 per cent in 2000 from 6.5

per cent in 1997 but fell back to 7.7 per cent in 2001.

The PPI says the growth in people eligible for means-tested benefits

means the interface between private and state provision should be


PPI director and co-author of the report Alison O&#39Connell says: “The

danger is most people with moderate second pensions will be on

means-tested benefits in the future. This makes it difficult for

people to save and know they are getting value in the future.”


Widows boosted by 25% increase in IFA business

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£750k fine for BoS fund admin failure

Bank of Scotland has been hit with a fine of £750,000 by the FSAfor failures in administering its Pep and Isa funds between November1999 and August 2001.According to the FSA, BoS put 30,000 Pep and Isa fund customers atrisk of losing money and increased its own exposure to potentialfraud.The regulator says the bank&#39s systems used […]

Barclays says hello to Hi-ilda

Barclays Private Clients International has created the fifth issue of its high interest index-linked deposit account (HI-ILDA). HI-ILDA 5 is a combination of a guaranteed equity bond and a high-interest account. It is available in a choice of currency denominations – sterling and US dollars. Half of sterling investments will go into a high-interest account, […]

R&SA outsources closed life admin

Royal & Sun Alliance has signed an outsourcing deal with Unisys to administer its closed life business for an initial period of ten years. The move will see 1,700 employees transfer to Unisys under the deal. R&SA says the arrangement will result in efficiencies and cost savings for policyholders. R&SA will retain responsibility for regulatory […]

Finding security in bond markets

Martin Foden, head of credit research at Royal London Asset Management, explores the role of secured bonds, considering the impact of default and the characteristics of secured bonds versus supranationals and highlighting some examples. He also examines the evolution of the credit market and rating agency inefficiencies. Read the article in full: The value of […]


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