Good morning and welcome to your Morning Briefing for Thursday 23 March, 2023. To get this in your inbox every morning click here.
Upsetting the pension tax apple cart
A famous satirist once said, “Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies.” An assessment – possibly a rather harsh one – of the life of the lifetime allowance (LTA).
I have campaigned for its abolition for the best part of two decades. I have argued it acts as an unnecessary barrier to retirement saving, particularly in defined contribution (DC) schemes, punishing those who achieve strong investment growth with a tax charge on the excess of up to 55%.
State pension age
The government has been full of pension policy announcements recently.
It all started with the Spring Budget on 15 March when chancellor Jeremy Hunt abolished the lifetime allowance and increased the annual allowance from £40,000 to £60,000.
Now the government has said it will delay the increase to the state pension age that is currently 66 and was due to increase to 67 between 2026 and 2028 and then would rise again to 68 after 2044.
The government was contemplating whether to raise the SPA to 68 between 2037-39 in a review of the issue that was due to be published by 7 May.
According to the Financial Times this decision will now be pushed back to after the next general election.
This has inspired our weekly poll below.
Loading …MMI Leeds: Big tech opportunities
Big Tech’s presence in UK financial services has recently been increasing and has the potential to grow quickly.
In payments alone, we have already seen Amazon offer a payments application programming interface for its third-party apps and websites, Google and Apple launch digital wallets for their devices and Meta attempt to enter the crypto-asset space.
Given the potential implications for consumers and competition, we need to better understand the emerging risks and opportunities to ensure benefits to consumers are harnessed and important harms mitigated.
Dr. Liza Lovdahl Gormsen is senior adviser at the FCA and will be speaking at Money Marketing Interactive Leeds on 11 May.
She has written a column about the potential opportunities from big tech in financial services.
Quote Of The Day
We urgently need to take a more comprehensive look at the role the state pension plays alongside the working age benefits system and other initiatives such as auto-enrolment if we are to develop a policy response that genuinely addresses the realities of inequalities in work and health.
– Catherine Foot, director of Phoenix Insights, the longevity think tank on the delay in the state pension age hike
Stat Attack
One year on from the publication of the NICE guidelines which emphasise the importance of upskilling line managers in talking about mental health, new research reveals more still needs to be done. Working To Wellbeing’s Window to the Workplace research has found.
29%
Almost a third of line managers are not aware of the NICE guidelines, rising to
38%
Of those aged 55+
19%
One in five are “very aware”, which rises among younger workers aged under-35 (23%) and falls among older workers aged 55+ (10%)
67%
Of line managers know how to spot early warning signs of poor mental wellbeing (of which 24% “strongly agree” they could spot the signs), but this falls among older managers aged 55+ to 60% and 14% respectively
71%
Seven in ten line managers feel confident having a conversation with a colleague about mental wellbeing at a time of crisis, of which 28% “strongly agree” with the sentiment. In comparison, just
57%
Of employees feel confident having a conversation with their line manager about their wellbeing at a time of crisis, while 18% do not.
Source: Working To Wellbeing
In Other News
Professional services firm Aon has announced Carole Judd as non-executive chair of Aon Investments Limited (AIL). Judd will also join the Aon UK Limited board as a non-executive director.
She holds a number of non-executive roles for the BNY Mellon UK Fund companies and sits on the investment committee of Nucleus Financial. Her career has spanned 35 years of asset management and investment consulting experience, with numerous senior leadership roles, notably at Old Mutual and WTW.
Aon UK chief executive officer Julie Page said: “Carole Judd brings a wealth of experience and financial and investment expertise to Aon. She will work closely with Tim Giles, senior partner and EMEA managing director for Aon Investments, and the AIL executive committee, to enhance effective governance and to support the committee in achieving its strategic objectives.
“Through this role and as a non-executive director of Aon UK Limited, she will make a significant impact on our UK business and with helping our clients to navigate new forms of volatility. I am looking forward to working closely with Carole over the coming months and years.”
Investment, protection, and retirement specialist LV= has signed to the Origo Dashboard Connector as its Integrated Service Provider (ISP).
The move will enable LV= to connect to the Pensions Dashboard and respond to policyholders’ pension data requests.
LV= has chosen to connect using the Origo Dashboard Connector’s fully managed option, where Origo undertakes the complete fulfilment process on behalf of the provider based on a regular data update from the provider.
LV= savings and retirement director David Stevens said: “The Pensions Dashboard will enable pension savers to monitor their pension funds in a single place and will become an useful tool for planning retirement.
“It will play an important role helping people to better understand how much they have saved for retirement and motivate them to engage in planning for when they stop work.
“The average person is likely to have numerous different jobs during their working life and a corresponding number of workplace pensions. The Dashboard is an essential development to ensure people can keep track of all their different retirement savings pots as they move through their career.
“LV= is committed to ensuring we respond to requests for pension data via the Dashboard as quickly as possible and we wanted a system that links seamlessly and securely with the Dashboard.”
From Elsewhere
Swiss regulator says central bank loan to Credit Suisse justified AT1 bond writedown (CNBC)
The absurd arithmetic behind Centrica boss’s bonus (The Guardian)
Rishi Sunak paid more than £400,000 in tax last year (Financial Times)
Did You See?
Former Abrdn advice director Neil Messenger has announced he is launching his own independent advice business, Money Marketing can exclusively reveal.
Messenger, who has amassed a wealth of experience building and leading Grant Thornton wealth advisory business for more than 17 years, will lead the new company – Professional Independent Wealth Advice (PIWA).
The business will work with Sandringham Financial Partners, which will provide administration and business support.
