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Probe will look at mutual life after Equitable

The Government is to launch an independent review into corporate governance of mutual life offices following this week&#39s publication of Lord Penrose&#39s comprehensive report into the Equitable Life debacle.

Former Gartmore chairman Paul Myners, who carried out the Treasury-commissioned review into institutional investment, is to lead the review, looking at member involvement in mutual office governance, board accountability and the level of FSA regulation that mutuals are subject to.

Industry experts believe that the review is as much a result of events surrounding Standard Life as it is an outcome of the fallout from Equitable.

Recommendations from the mutual review are expected to be delivered to the Government by the end of the year, with Treasury Financial Secretary Ruth Kelly saying mutual life office boards should be as accountable to members as plcs are to shareholders.

The Government is also planning to review the actuarial profession and it has asked the Accounting Standards Board to carry out an urgent study into with-profits business accounting by life insurers.

Commerzbank insurance analyst Roman Cizdyn says: “There were cultural issues discussed at length in the report and the Government is trying to stop such a culture if it exists elsewhere.”

Co-operative Financial Services chief executive Mervyn Pedelty says: “We maintain the mutual sector has a significant role to play in the future provision of financial services within the UK and we are confident the moves announced will in time further strengthen the inherent consumer appeal of the mutual sector.”


NAO says Treasury numbers affected by lifetime limit

The National Audit Office says the Treasury&#39s estimate of the numbers likely to be affected by the £1.4m lifetime limit is only half the figure it thinks will be hit.Th NAO also says there is a “thin evidential base” for the Treasury&#39s estimate of a further 1,000 people a year affected by the limit that […]

A family affair

I am due to retire in June 2004 at 60. I am a member of a pre1987 money-purchase pension plan insured with Scottish Widows, with earnings above the cap. The benefits are held within its with-profits fund and I am eligible for a guaranteed annuity. The guaranteed annuity is at a rate of £98.02 annuity […]

Independent view

I sometimes think the world has gone mad but then I realise that it still goes round in the same old way and it is me who is fast becoming an old stuff. Or has it gone mad? Am I an old stuff? Answers on a postcard with a £5 note and an original driving […]

Government should push on with pensions simplification, says IMA

The IMA has welcomed the NAO findings and says the Government should push ahead with pension tax simplification as a result. Chief executive Richard Saunders says: “More than any other proposal currently under discussion, pension tax simplification holds out the prospect for decisive change for the better in the long term savings market and will […]


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