Some significant statements have recently been made regarding the future of “stakeholder” pensions.
First, a number of providers, including Marks & Spencer and Abbey National have stated that they are to end the marketing of group stakeholder plans.
In addition, Norwich Union have now more than doubled, from seven to 15, the number of years they expect to pass before they can make a profit out of the Government's idea of a pension plan.
As NU's estimate has increased so greatly, there can be no confidence that the second guess will be any more accurate than their first.Thank goodness they are using someone else's money and not their own.
Given the current sentiment, taking account of the take-up rate and non-viability of providing “stakeholder” pensions, is it not time that the whole industry pulled the plug and stopped providing them?
All current funds could be dealt with on the original basis and policyholders would have a choice. They could either carry on with contributions into a proper scheme, with proper costs and where the cost of advice is factored into the charges, or they could make the pension plan “paid up”.
Is it not time that the life insurance and pension industry stopped using their policyholders' and shareholders' money to pay for the impractical concepts of inexperienced civil servants?
Let those who would continue to promote such impractical and non-viable ideas pick up the tab.
Let Gordon Brown, Howard Davies and Ron Sandler pay for these plans out of their own pockets, not out of policyholders' and shareholders' money.