View more on these topics

Tories pledge to adopt McDonald annuity plans

A Conservative Government would adopt the proposals of former Labour social services spokeswoman Dr Oonagh McDonald as part of sweeping reforms of the annuity rules.

The McDonald report, written by the former regulator and prominent Labour MP last year, says people should only be obliged to purchase an annuity that secures a sufficient level of income so they do not have to fall back on state benefits in the future. This would free up the remainder of their pension pot to be invested elsewhere.

The Liberal Democrats say they would also scrap the obligation on people to buy an annuity as long as there is no chance they would need benefits at a later date but say that they are not accepting Mc Donald&#39s proposals.

The Tory reforms would go further than LibDems proposals as people would need a guaranteed income keeping them off state benefits, but not necessarily an annuity.

They say the City is cap able of designing financial products that will adequately cover people.

Tory Treasury spokesman Richard Ottaway says: “It will be the Conservatives after the next election that will change the obligation to buy an annuity by adopting the Oonagh McDonald proposals.”

Conservative pensions spokeswoman Jacquie Lait agreed with Ottaway. She says: “Basically, there is not much difference between our proposals and McDonald&#39s. In a sense, ours go even further as we are not forcing people to buy an annuity at all.”

Liberal Democrat social security spokesman Steve Webb says: “Provided there are safeguards to ensure that those who draw down their pension funds do not end up reliant on means-tested benefits, I can see no reason for a compulsory requirement to purchase an annuity, and would support measures to relax existing restrictions.”

Recommended

Axa website will offer advice and sell direct

Axa is setting up a new website through which it plans to offer online advice on its own and eventually its competitors&#39 products direct to the public. The site, internally named eAxa, aims to build awareness on the back of Axa&#39s FA Cup sponsorship. But the move has stirred IFA concerns that it will pave […]

Neville James harnesses teps and zeros

Examining the strong points offered by the product, Ball says: “There is the solid asset backing of TEPs, the flexibility of cashing in and tax effective potential, the fact that it is Isle of Man based and so provides lower tax charges, the fact that it offers redemptions in any freely transferable currency and lastly […]

Fiduciary Trust International – Swiss Equity Fund

Thursday, 11th January 2001.Type: Ucits.Aim: Growth by investing in small and medium cap Swiss companies in the industrial and service sectors.Minimum investment: A shares – SFr 10m, B shares – SFr 2,000.Place of registration: Dublin.Investment split: Machinery 16.8 per cent, pharmaceuticals 12.9 per cent, food 11.4 per cent, engineering and electronics 22.1 per cent, other […]

Ethical choice for Holden Meehan

IFA firm Holden Meehan is introducing the UK&#39s first ethical stakeholder friendly group personal pension in conjunction with Friends Provident. This unit-linked pension has been designed to give employees an ethical option before the introduction of stakeholder pension in April 2001. Contributions can be made at any time and the minimum regular contribution is £20. […]

Allianz Technology Trust – April 2017

Welcome to the latest update for Allianz Technology Trust PLC from the Trust’s portfolio manager, Walter Price. Portfolio review The Trust’s NAV returned 4.3% , outperforming the Dow Jones World Technology Index return of 2.8%. In US dollar terms, the portfolio gained 4.8%. During the month, stock selection contributed to relative performance, and industry allocation […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment