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Warning of stakeholder killing AVCs

The new partial concurrency rules under stakeholder could spell the end of the additional voluntary contributions market, says Punter Southall & Co.

A survey of the UK&#39s top 350 companies recently conducted by the consulting actuaries shows 85 per cent of eligible employees will consider using stakeholder as an alternative to AVCs. Under stakeholder rules, employees earning up to £30,000 a year can contribute to stakeholder while remaining in their employer&#39s occupational scheme.

This has fuelled concern that instead of simplifying pension planning, stakeholder is likely to baffle savers because it offers yet another choice.

Punter Southall says although stakeholder was designed to benefit low-earners, it has ended up as a savings plan which will benefit big numbers of higher earners who typically contribute to AVCs.

Principal Steve Leake says: “Stakeholder concurrency may also encroach into the AVC market since the attractive features of stakeholder, which include providing part of the benefit as a tax-free lump sum, will make them a very competitive alternative to AVCs.”


New brand from merger of Capel and Greig Middleton

Fund manager Capel Cure Sharp is rebranding as Gerrard Investment Funds as part of the ongoing merger of Old Mutual&#39s private client investment subsidiaries. The move will see Capel Cure Sharp and Greig Middleton & Co merged to create Gerrard. Advertising to promote the new brand will start in May with a series of ads […]

Uk venture capital funding a third of US level

UK venture capital funding is 30 per cent of the US level per pound of gross national product, according to a report published by the Centre for Policy Studies.The report says while in 1998 venture capital backed companies contributed £22.3bn in taxes, the UK tax and regulatory system is inhibiting economic potential.The report calls for […]

Agents lack experience for stakeholder, warns R&SA

Royal & Sun Alliance is calling for tied agents to be limited to offering one stakeholder plan when polarisation rules are relaxed in April. R&SA says it is concerned that tied advisers do not have the experience to advise on variants of the same product from different companies. Its call is one of many industrywide […]

Juliaan Gibbs

The ideal investment is one that gives high potential growth or income with a guaranteed return. Credit Suisse First Boston has pioneered an investment for institutions which should achieve this objective. It invests in a portfolio of hedge funds and fixed-interest securities and gives a guaranteed return of the original capital invested after a number […]


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