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‘Turner cost-cutting will push out IFAs’

Standard chief Lawson calls for open debate on advice and how it is funded.

Lord Turner’s obsession with offering cheap pensions will squeeze advisers out of the individual pension market, warns Standard Life head of pensions policy John Lawson.

Lawson is calling for the ind-ustry to have an open debate on the value of advice and how it should be funded rather than sit back and allow Turner’s recommendations to effect-ively remove advisers from the equation.

The initial leaks of the second Turner report suggest that a low-cost pay-as-you-earn pension scheme centrally administered by the Government, with charges of around 0.2 per cent a year, can undercut current pension charges, which typ- ically range between 1 per cent and 1.5 per cent.

Lawson believes the Pension Commission’s recommend-ations appear to be based on a combination of the Swedish and New Zealand systems, the latter of which will not be put in place for another two years. But he believes academics have come to the incorrect conclusion that these systems offer cheaper alternatives. He says that significantly in Sweden, the Government subsidises the level of charges that people pay, resulting in the Government having to bring a big bond issuance to the market to fund it.

He says: “There is a real danger that in the pursuit of being cheap, Turner is pushing out advisers and the providers that support them. If you cut the IFA out of the picture, all you leave is the Government in control and that could be dangerous.”

Tor Financial Services managing director David Harris says: “The report massively under-recognises the value of financial advisers. He has clearly gone for the low-cost, high-value approach. The report as it stands is misshapen and mistaken.”


Elephant Aim flotation to take place today

Elephant, the mortgage and loans packager will float on Aim today.The firm says it will continue to exceed budget with October being a record month for turnover and profits.Elephant says its shares have been oversubscribed, with as many as 21,666,6666 shares being issued at 3 pence a share, and a market capitalisation value at 6.3m.

Park Row sets site on recruitment

Park Row has set up a recruit- ment website for advisers. The site is aimed at advisers, managers and support staff. Park Row says it was inspired by the success of its recruitment micro-site which was launched earlier this year. It will provide information to anyone interested in joining the firm, detailing opportunities and details. […]

Guidelines bring accolade for Walsh

ABI head of health policy Richard Walsh has received an award from recognising the “respect and integrity” that he has shown to the gay community. The website for gay IFAs says Walsh’s role was instrumental during negotiations to create new HIV and insurance guidelines .The award was presented by human rights campaigner Peter Tatchell […]

Second among equals

The industry must focus on what women need from pensions if the earnings’ gap is to be closed.

How do you choose the best online service?

By Ross Jackson, senior marketing manager There are many different protection online services available in the market and no doubt you’ll have used a few when submitting protection business. But why should you have to put up with slow, unresponsive sites for your business when you’re used to dealing with slick, modern user experiences in your […]


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