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Questions on strength and trust

The Abacus consultancy director David Ferguson questioned the stated cost of smoothing, which Pru chief executive Mark Wood admitted is around a 0.75 per cent annual management charge.

Ferguson queried where the fund&#39s capital for new investment and offers such as extra allocations came from.

He said, with returns under pressure, costs such as this would be difficult to sustain. He also asked Wood how it was possible to trust the management of with-profits, given the performance of many funds in recent years.

He questioned how advisers and savers are supposed to identify which with-profits offices are strong, citing the example of Standard Life, which he said would have been on everyone&#39s list of strong offices a few years ago.

He said: “I agree the principle of with-profits is very strong and the characteristics are very well appreciated – my concern is mostly around how we judge what is a good with-profits policy.

“My big concern is why should we trust product managers now to manage it any better than we have the last three or five years?”


John Joseph on Protection

For my band of devout followers, the first critical-illness conference was almost a 100 per cent success, with 46 out of 47 attendees giving it excellent reviews. There was one unhappy person who was not impressed as he could not hear all that was going on – and the bit that he did hear, he […]

Bagger demands Standard windfalls for maturing plans

Members of Standard Life with with-profits policies which are due to mature before the demutualisation of the company are arguing that they should still get windfall payouts. Former Standard Life carpetbagger David Stone-banks says one member who has been a policyholder for 24 years and whose policy is due to mature soon has put his […]

Credit Suisse sets target for returns

Credit Suisse Asset Management is offering a fund investing in a wide selection of global fixed-income opportunities with a new investment concept it calls “target return”. First revealed in Money Marketing in February, the fund addresses investors&#39 needs for a product that targets a certain level of positive return within a strict risk control framework. […]

Online valuations highest priority for advisers poll shows

Online valuations is the most vital e-business development to help IFAs in their business according to a poll for 1st Software. In a survey of over 400 advisers 81 per cent said online valuations was the most important, with 40 per cent of firms saying they also used online valuations and e-submission services. Origo managing […]


Out from the long grass? An IT and NI merger

Those with a long memory will recall that at the start of the last parliamentary term George Osborne announced his intention to merge income tax (IT) and national insurance (NI).  Headline grabbing as the initiative was, the reality of the complexities, challenges and costs of such a move resulted in this idea being kicked into the political long grass.


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