Royal London is calling on the Conservative Government to merge the Money Advice Service with The Pensions Advisory Service in a bid to boost financial literacy in the UK.
Ros Altmann, who has now been appointed pensions minister, is set to investigate expanding the remit of Government-backed guidance service Pension Wise to all working people. The pledge was made prior to the general election and potentially casts doubt over the future role of MAS.
In a statement published alongside Royal London’s first quarter results, chief executive Phil Loney sets out five key priorities for Altmann.
These include introducing a “cheap and cheerful” regulated advice regime, reviewing pensions tax relief, increasing auto-enrolment contributions, legislating to make shopping around compulsory, and “consolidating the Money Advice Service and The Pension Advisory Service into a single truly excellent financial education service for all”.
The mutual’s results reveal a huge surge in sales ahead of the introduction of new pension freedoms in April this year. Total new life and pensions business was up 40 per cent year-on-year, from £988m to £1.38bn, driven by a 68 per cent rise in individual pensions sales, from £282m to £474m. Drawdown sales increased 67 per cent to £244m, while group pensions sales were up 16 per cent, from £444m to £515m.
Protection sales through intermediaries were up almost a third, from £81m to £107m, while direct-to-consumer protection sales were £5m during the quarter.
The provider’s investment arm, Royal London Asset Management, reported net new business inflows of £111m, down 88 per cent from £902m in the three months to 31 March 2014.
Gross inflows on Ascentric, the firm’s wrap platform, increased from £530.5m to £555.7m, with the pension freedoms driving an 80 per cent rise in Sipp business.
Loney says: “This is a very strong set of numbers, which comes on top of last year’s record results. In the key areas of pensions and protection we continue to increase market share. The fact that we continue to do so is a result of our investment in the quality of our product and service proposition.”