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Standard wants DB transfer shake-up

Standard Life is calling for a radical overhaul of the way that defined-benefit pension transfer values are calculated to put an end to the “derisory” sums that many people get.

It is urging the Department for Work and Pensions to remove actuarial departments’ discretionary powers, which it says are assuming outdated mortality rates and unachievable future investment returns that result in artificially low transfer values.

Head of pensions policy John Lawson says skewed calculations mean people transferring out of DB schemes need to achieve a return which comfortably outstrips average equity performance just to match the benefits being given up.

He says even allowing for higher charges in the receiving scheme, the charge-adjusted rate of return needed would normally fall between 8.2-10.2 per cent.

Standard wants fixed mortality tables and suggests they should be based on social class and occupation.


Pru moving into individual Sipps

Prudential has become the latest major insurance firm to launch into the individual Sipp market. The product, a deferred Sipp, is available through Pru’s flexible retirement plan and is designed so investors can switch on the self-investment facility when their pension fund reaches £10,000. Investors can access a range of in-house funds and over 800 […]

MPs clash with Crombie on pay

MPs have criticised Standard Life group chief executive Sandy Crombie for agreeing to bonus payments which they claim contradicts a pledge that he made to them. Mutuo, a research group which acts as secretary to the All Party Parliamentary Group for Building Societies and Financial Mutuals, says Crombie told the group in 2004 that he […]

Thoresen says A-Day pension sales boost could last for years

Aegon UK chief executive Otto Thoresen says A-Day could help drive pension sales for two or three years. He expects to see the current business momentum continue in the second half of this year and into next year and beyond. Aegon UK saw a 55 per cent increase in life and pension business in the […]

No-score draw

“I’ve never wielded an axe in my life.” Bankhall chief executive officer Peter Mann to colleague Richard Howells”It’s like people’s sexuality. There is no black or white, just many shades of grey.” FP Advance’s Brett Davidson on the fees versus commission debate”It always makes me laugh when the waiter comes and asks what you would […]

Flexible reversionary trusts and estate planning

The suitability of different estate planning solutions will depend on the individual’s own circumstances, needs and objectives. When considering the different solutions available there is a trade-off between inheritance tax (IHT) efficiency and access. Overall a flexible reversionary trust provides a greater level of flexibility than a discounted gift trust and can offer individuals a […]


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