The Treasury has published its long awaited consultation on the make-up of the Sandler suite of products, setting out the specifications for the products.
The suite will include an equity based product, a with-profits product and a pensions product although the Treasury says there is a case for including other products within the suite.
The main candidates for this extension are a guaranteed product, a term assurance, a deposit account, an annuity, a financial health-check and the Child Trust Fund.
The Government remains committed to the 1 per cent price cap, saying it has brought considerable benefits to stakeholder pensions and Cat marked Isas. However, the paper says it recognises the need for companies to be able to earn reasonable returns to capital.
Sources close to the Treasury say one possible outcome of the consultation could be different charging structures for the different products in the suite, although this possibility was not explicitly included in the paper.
Treasury Financial Secretary Ruth Kelly says: “These products will be simple, low cost and risk controlled. They are aimed at the millions of people who find financial services and products confusing, people who have the ability to save but aren't currently doing so and consumers who are not attracted to, or best served by complicated products.
"In order to be successful in getting lower income people to save more for their future the product specifications must be right. This consultation provides the opportunity for everybody to put forward their views and I look forward to receiving responses from a wide range of people."