Industry Insights

Read the latest financial industry insights, hand-picked by the Wealth of Advice team… 

Government proposes £17bn public sector pensions remedy

Government plans to rectify a pension discrimination issue highlighted by two landmark court cases are expected to cost taxpayers £17bn. The Treasury published a consultation looking at how it will implement the McCloud and Sargeant judgments to remove discrimination between pension scheme members. The issue concerns public sector pension scheme members who were enrolled into newer schemes while older scheme members' defined benefit pension accruals were protected from a downgrade. The courts...

read more

Chancellor questioned on triple lock pledge

The Chancellor of the Exchequer has kept his cards close to his chest when grilled on plans to revisit the pension triple lock in the upcoming budget. At an evidence session yesterday, Rishi Sunak faced questions from Labour MP Mike Hill on whether it was acceptable to break manifesto commitments on the triple lock. The chancellor stood firmly by his mantra of not being able to comment on "future fiscal policy", one which he repeated multiple times throughout the committee session. It comes...

read more

Chancellor eyes capital gains tax overhaul

Rishi Sunak is mulling an overhaul of capital gains tax as he explores whether the current system is fit for purpose. The chancellor has today commissioned a review of CGT in relation to individuals and smaller businesses, asking the Office of Tax Simplification to consider the overall scope of the tax and the rates which apply. It will also look at the reliefs, exemptions and allowances which apply to the gains tax. Mr Sunak has already slashed entrepreneurs’ relief, limiting the allowance to...

read more

Women play ‘catch up’ as more men seek financial advice

Women are left playing catch up and £100,000 worse off in later life as men are more likely to seek financial advice in their younger years than their female counterparts, research has shown. Fidelity’s Unlocking the Power of Financial Advice report, published today, found 21 per cent of men aged between 18 and 34 years had sought help from a financial adviser, compared to just 12 per cent of women the same age. This was despite almost a quarter (24 per cent) of young women worrying about...

read more

DB transfers suffer ‘dramatic drop’

The volume of defined benefit transfers has fallen sharply over the last three weeks, according to consultants Lane, Clark and Peacock. In a weekly analysis, LCP looks at the number of requests to transfer out of 81 DB schemes it administers. The purpose of the exercise is to monitor how transfers have been affected by the Covid-19 crisis. The latest numbers show there has been a noticeable fall in the number of DB transfers from late June to now. This is a marked contrast to signs in May and...

read more

Advisers unite in call to scrap lifetime allowance

A number of advisers have renewed calls to scrap the lifetime allowance due to the complexity of the rules and the fact it causes a “double hurdle” for pension savers. In a poll of 75 advisers by pension provider Curtis Banks, 83 per cent said the lifetime allowance should be abolished as the rules are too complex for savers to understand with more breaches occurring each year as a result. According to official figures, in the 2011/12 tax year there were 940 cases of lifetime allowance...

read more

Chancellor’s kickstart scheme to boost pension saving

Government plans to create jobs for 16 to 24-year-olds could see more young people saving for retirement, according to the pensions industry. The government has confirmed that as part of its kickstart scheme, employer minimum auto-enrolment contributions will also be paid by the state, which could result in more young people being enrolled into a workplace pension, according to Steven Cameron, pensions director at Aegon. Mr Cameron said: “It’s great to see the chancellor again support...

read more

Pensions tax relief and triple lock spared – for now

Pensions tax relief and the triple lock have once again been spared by the chancellor, although changes to these costly policies are expected down the line. In a spend-heavy economic statement, chancellor Rishi Sunak chose not to mention how the government would pay for its VAT and stamp duty cut, among other announcements, in a move which saw the triple lock and tax relief protected. There was speculation from the industry that the chancellor would look to either scrap or reform the pensions...

read more

DB enquiries rise as savers worry about schemes

AN advice firm has reported an increase in enquiries from clients concerned about the stability of their defined benefit (DB) schemes. According to Killik & Co, a higher than usual number of savers have asked for help on their DB pension, citing concerns about the financial security of their employer amid the Covid-19 pandemic. Svenja Keller, head of wealth planning, said this was particularly true for some industries which have been severely impacted by the lockdown, such as travel. Ms...

read more

Pensions hit hardest by furlough

Furlough has been more damaging to savers’ pension contributions than their wages, with low earners being hit the hardest, according to Now: Pensions. Analysis from the workplace pension provider has found the effect of furlough saw pensions reduced by more than a quarter, whereas wages were typically cut by 20 per cent. This was because the first £120 of weekly furlough pay did not count for pension purposes, Now: Pensions said. For example, a worker who was earning £400 per week before...

read more