Industry Insights

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

Advisers back plan to allow trustees to stop transfers

Proposals to give trustees the power to halt pension transfers where a scam is suspected have gained support from advisers, despite some scepticism over the practicality of implementing them. Keith Richards, chief executive officer of the Personal Finance Society, said this week's amendment to the Pension Schemes Bill, which seeks to remove people's statutory right to transfer where a scam is suspected, was a positive move. But he warned it must not stop legitimate transfers from taking place....

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Divorced women could be owed £50K due to pension loophole

Advisers have been urged to check the state pension payments of women who divorced later in life as they could be missing out on large sums due to a loophole in the rules, according to consultancy LCP. LCP said women aged 60+ who reached state pension age before April 6, 2016 could be due uplifts of more than £50,000 over the course of their retirement due to a little-known rule. This is because they fall under the old state pension system which makes significant provision for divorced women....

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Pension bill amendment to give trustees power to halt transfers

Trustees of pensions schemes could soon be getting more powers to halt suspicious pension transfers, according to the Pension Scams Industry Group. The group said an amendment restricting the statutory right to a transfer is to be tabled to the pension schemes bill by two MPs, in an attempt to combat pension scams. It had proposed the amendment in its submission to the Work and Pensions Committee inquiry on pension scams currently underway. The amendment comes as the Pensions Regulator told...

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Savers urged to ‘engage with pensions’ to tackle climate change

Savers can play an important role to address climate change by paying more attention to their pensions and where they are invested, pensions minister Guy Opperman has said. Mr Opperman said if people wanted to contribute to the net zero effort then they had to “engage with their pensions and encourage sustainable investments”. His comments formed part of a collection of essays, published by the cross-party think tank Social Market Foundation and the Chartered Banker Institute, about green...

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Collective defined benefit pensions ‘70% higher’ than traditional DC schemes

New research estimates that collective defined contribution pensions would be on average 70 per cent higher than traditional defined contribution, and 40 per cent higher than typical defined benefit schemes. CDC is a novel form of retirement provision under which employers pay a fixed rate of contribution into the scheme and members are paid pensions with variable increases. A change in law expected to allow employers to establish their own CDC arrangements is due as early as next year. Unlike...

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MP calls for abolition of council tax and stamp duty

A Conservative MP, who once ran a national chain of estate agents, has written to Boris Johnson urging him to abolish stamp duty and council tax. Kevin Hollinrake, who is the MP for Thirsk and Malton, urged the Prime Minister to replace the present system of council tax and stamp duty with what he calls a “proportional property tax” at a flat rate of 0.48 per cent annually. This would be split between national government and the local authority, with 0.32 percent going to the latter. The tax...

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Over-50s alter retirement plans in response to Covid-19 crisis

One in eight older workers have changed their retirement plans due to the coronavirus, according to the Institute for Fiscal Studies, which warned a third are now in a worse financial situation than they were in before. Research from the IFS found 8 per cent of older workers now plan to retire later than they had previously intended, while a further 5 per cent plan to retire earlier. Retirement deferrals were more common among those who had seen their pension fund fall in value, with...

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Warning as 42% of pensions raided at ‘unsustainable’ levels

  Savers have been warned they could face trouble in the future as the regulator found 42 per cent were taking more than 8 per cent from their pensions each year. Latest data on the retirement income market from the Financial Conduct Authority found savers with smaller pension pots, typically worth between £10,000 and £100,000, were particularly susceptible to high withdrawal rates. Those with pots worth more than £250,000 tended to be more cautious and take smaller withdrawals. Steven...

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Prime Minister urged to show leadership in fight against scams

Prime Minister Boris Johnson has been pressed to take an interest in the growing pension scams issue to stop it becoming a “national scandal”. In an open letter to the PM, Andy Agathangelou, founder of the Transparency Task Force, said the Prime Minister’s support was key and that under “leadership through visible personal interest”, Parliament could stop pension scams reaching “pandemic-like proportions”. The letter followed a meeting with the prime minister last week to discuss the scams...

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Advisers looking for help over vulnerable clients

Advice firms are looking for solutions to help implement best practice around vulnerable clients as research shows the vast majority of advisers think it is important to keep to up to date on policy in this area. Data from Just Group, published today, showed practically all financial intermediaries (98 per cent) believe it is important to keep up to date with developments on the vulnerability agenda. Just polled 170 advisers in July and found the sector was looking for support on the...

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