Of course, that was a few years ago.
This week GE Life has led industry-wide calls for IFAs to continue to advise suitable clients to take out Asps and defy increasing Government pressure.
Fears that the Government will spoil or scrap Asps heightened last week when Treasury Economic Secretary Ed Balls confirmed changes will be included in the next Pre-Budget Report.
The Government says advisers are abusing Asps by making them widely available, as it claims they were designed solely for people with moral or religious objects to annuities.
But GE Life retirement product design manager Ray Chinn says there is absolutely no point in advisers ruling out Asps until the Government confirms the industrys worst fears. This is for the very simple reason that people with Asps can switch to an annuity but people advised to take out annuity are stuck with their choice.
As Hargreaves Lansdown head of pensions research Tom McPhail points out, this poses a very real threat for IFAs. He warns that over cautious advisers could face misselling claims if they advise customers to take out an annuity rather than an Asp and the Government fails to follow through with its warnings.
Chinn’s calls have been branded common sense by a wide range of respected advisers and providers, including Norwich Union, Winterthur Life, Standard Life and Origen.
Let’s hope this united industry front against the Government’s ludicrous treatment of what is an invaluable (and tax beneficial) alternative to annuitisation, will make the desired impression before the Pre-Budget Report.
Elsewhere the ABI has made the rather fortuitous discovery that a centralised NPSS scheme would not be significantly cheaper than an industry-led scheme, made up of competing branded providers.
It says the findings demonstrate the need to base the decision on who runs NPSS on more than just cost.
The new report, conducted by consultancy firm Oxera, rejects the argument that one centralised fund will benefit from greater economies of scale than a number of separate funds.
It says a single centralised default fund would fail to achieve advantages in terms of economies of scale over the default funds of branded providers.
Economies of scale for administration, it argues, are limited beyond 500,000 accounts. Economies of scale on fund management for funds of over 1bn, a scale which it says the average industry default fund would rapidly achieve, are also strictly limited.
The report also says the likely level of marketing expenditure envisaged for Personal Accounts of 2 per cent of revenues, is roughly equivalent to the bidding and other transaction costs for a centralised NPSS model of delivery – with an average of 2.9 per cent of contract value for similar large products.
The report argues that switching between providers is desirable because it creates pressure on providers to reduce costs and improve service. It says, in the absence of financial intermediaries the cost of switching will be small and would only have an impact of up to 5 basis point on consumers.
The dubious track record of previous large public admin IT projects is also raised in the report, which argues this demonstrates a number of risks attached to a centrally administered NPSS scheme.
Of course, this all bodes very well indeed for anyone wanting a NPSS administered by competing, branded providers.