Latest articles on The Money Debate

Should Nest have been put on probation before the restrictions were lifted?

July 17th, 2013

Nest, the pension scheme that will soon be one the UK’s most important with a huge proportion of the workforce signed up to its own particular investment approach has uncovered a rather unfortunate fraud issue with one of its suppliers.

The chief Tim Jones is to forgo his bonus as a result, as Professional Pensions reports today which seems fair enough. But surely, the wider question is whether the lifting of the Nest restrictions should have been announced – admittedly in 2017 – before the wider world knew of the problems there.

There is rather a lot of ideology involved in the decision as well as many practicalities. The ideological side of the equation involves a deep seated suspicion of the private pension industry which pervades all parties and their policies though more so those to the left of the political spectrum. The practical issue is that the contribution limit would have restricted Nest in its appeal though it might helped concentrate  minds within the organisation on focusing on schemes and members that other pension firms didn’t more

Pay rise or not, why don’t MPs have to have their pension with Nest or is it not good enough for the likes of them?

July 11th, 2013

Intriguing that in the MPs’ salary debate, a move to a career average system from a final salary one, is seen as something MPs would concede in return for more money. That sounds okay but it also involves them contributing substantially less (teachers take note). Anyway I made the following argument today wearing a journalistic hat for a consumer audience on Mindful Money. I suggested that since MPs are currently debating pension legislation which will see most people in DC of some form, that perhaps they should be in DC too.

Having mulled this a little further and given the news about the lifting of Nest restrictions and the fact the OFT is now worrying away at AE pensions set up under commission, perhaps MPs should automatically be entered into Nest, and quite obviously with no advice attached unless they were prepared to pay for it.

The ultimate in alignment of interests between elected and electorate. And it could be in return more

Does retail financial services need a shake up in the approved persons regime?

July 9th, 2013

This may go without saying but the move to abolish the approved persons regime has come about because of the behaviour of senior banking staff and the inability of the FSA/FCA to come down on them like the proverbial ton of bricks.

Not a bad initiative you might say, recommended by the Parliamentary banking commission, with a senior persons regime requiring a high degree of responsibility with lower level staff to be licensed. The chairman of the FCA John Griffith-Jones, reported in Money Marketing, says he sees no reason why the regime should not apply across the market.

But although the Money Debate hasn’t made up its mind, we do need to ask if the change is necessary, appropriate and proportional when it comes to advisers. In fact, do IFAs and others in this neck of the woods have a view whether the approved persons regime has worked. (It does seem most people make it through which may be a bad sign). But more