View more on these topics

Thinktank says Hutton proposals not sustainable

The Centre for Policy Studies is urging the Government to go beyond Lord Hutton’s controversial public sector pension reform recommendations, claiming that the proposals are “not sustainable”.

Hutton’s report, published in March, proposed a range of changes to public sector pensions schemes designed to make them “sustainable and affordable”, including switching from final-salary to career-average provision.

Centre for Policy Studies research fellow Michael Johnson says a future Government will be forced to revisit public service pension reform unless the coalition puts in place long-term plans to introduce a “pure” defined-contribution framework.

He says: “Full implementation of Lord Hutton’s proposals, let alone anything weaker, would not fulfil the most fundamental of Lord Hutton’s own criteria. The new arrangements would not be sustainable from both affordability and fairness perspectives.

“Cutting the cost of public sector pensions by 25 per cent would save taxpayers billions of pounds every year, stretching into the future. The present value of such an annuity saving would be over £100bn in today’s money.”

The warning follows a report from Johnson in February which urged the Government to automatically enrol all public sector workers into Nest as part of a radical shift towards pure DC provision.

However, Hutton rejected the proposal, saying: “I decided not to recommend DC for a number of reasons, not least that ring-fencing the contributions would leave a significant black hole in public finances.”


Aviva Investors aims to promote sustainable investments

Aviva Investors has commissioned a report which proposes environmentally hostile activities result in higher insurance premiums for companies. Forum for the Future this week launched the ’Sustainable economy in 2040; a roadmap for capital markets’ report, which calls for the prioritisation of environmentally sustainable investments. The report outlines a series of actions, including issuing penalties […]

Dennehy issues strategic bond warning

Dennehy Weller managing director Brian Dennehy has warned investors to steer clear of strategic bond funds with large high-yield bond exposure. He says the “deflationary mix” in the markets has benefited high-quality bonds while the significant slowdown in economic growth globally does not suit high-yield bonds. He says many strategic bond fund managers have invested […]

Rates of change

Taxation plays an important role when businesses and governments are looking at increasing revenue and cutting costs


Small Sipp providers face FSA visits

The FSA is visiting a number of small Sipp firms to investigate the risks posed by unregulated collective investment schemes. Over 2008 and 2009, the FSA undertook a thematic review of around 70 small Sipp providers to identify whether they were meeting its regulatory requirements. Earlier this year, the FSA asked small Sipp providers to […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm