Last December, FRC’s (Financial Reporting Council) Board for Actuarial Standards published a new version (2.0) of Technical Memorandum (TM1): Statutory Money Purchase Illustrations (SMPI). Two key areas of change embedded in the document is in the updating of mortality assumptions and the taking into account of potential investment returns when setting the long-term investment assumptions used in projections.
Posts Tagged ‘member’
FSA – Regulatory Priorities for 2008
Monday, May 26th, 2008
What are the key themes for the member directed pensions market with regards to FSA thinking.
1. Better consumer outcomes are at the heart of policy decision making
2. Providers need to ensure their products are being sold and marketd to approproate consumers
3. Suitability of transfers remain high on the agenda – so an increase focus on consolidation. This I guess is an amber light for the wrap platforms to consider,
4. Transparent retail disclosure will receive more emphasis – illustration etc.
Taken from Steve Folkard’s (AXA) presentation at teh AMPS conference
Machiavellian ASP – surely not – Alternatively Secured Pension
Friday, October 26th, 2007
Reading in the recent AMPS – Association of Member Directed Pensions newsletter a fascinating angle on the Alternatively Secured Pension – ASP saga.
John Bradley, outgoing chairman states that the government created the current ASP regime, knowing that the industry would kick back at the restrictions. Effectively the government created a regime so that they could accuse the industry of abusing the ASP rules, and that the adverse publicity surrounding this would be used to going back to justify compulsory annuities.
SIPP is dead long live ABATIC
Thursday, August 9th, 2007
Another topic of discussion at the recent Henry Stewert Conference was the use of SIPP as a term for pensions that are member directed. Clearly when AMPS was founded the phrase SIPP was not considered even though the SIPP Provider Group Association was half of the association with Pensioneer Trustees (APT) . Quite right too, the growth of the Pseudo SIPP market is creating confusion for consumers. Perhaps ABATIC would be better, A Better Acronym To Inform Consumers !
ASP automated or not
Wednesday, August 8th, 2007
I came across this change to USP/ASP rules introduced in the Finance Bill 2007. Basically there is no automatic movement of funds from a USP to an ASP at the members 75th birthday. I suppose this was inevitable given the introduction of a minimum income limit for ASP.
16. Paragraph 11 inserts new sub-paragraphs (6) and (7) into
paragraph 11 of Schedule 28 to FA 2004, which introduce new
provisions for members of registered pension schemes who
cannot be traced by their 75th birthday. Paragraph 11 of Schedule
28 provides for the conditions that apply for sums and assets to
become held in an ASP fund on the member’s 75th birthday.
Funds that were held in an unsecured pension fund immediately
before the member’s 75th birthday are treated as becoming held as
an ASP fund when the member reaches age 75. The changes
introduced by paragraph 11 of the Schedule will mean that for
HM REVENUE AND CUSTOMS FINANCE BILL 2007
CLAUSE 68
SCHEDULE 19
members that the scheme administrator can not trace by their 75th
birthday, their funds will not automatically be treated as
becoming held in an ASP fund at that point.
!” New paragraph 11(6) of Schedule 28 provides the conditions
for funds to become held under the separate provisions for
untraceable members. These are that a scheme administrator
has taken reasonable steps to trace a member and has been
unable to find them. There is also a requirement that no part
of the funds in the arrangement were treated as being
designated into unsecured pension, other than by the
operation of paragraph 8(2) of Schedule 28.
!” New paragraph 11(7) of Schedule 28 provides that where the
conditions of new paragraph 11(6) of Schedule 28 apply then
the sums and assets in the member’s pension fund will not
become held as an ASP fund on the member’s 75th birthday.
Such funds having previously been designated into unsecured
pension by virtue of paragraph 8(2) of Schedule 28 to FA
2004, will effectively remain in suspense unless the member
is subsequently traced. While the funds remain in suspense,
any payments from the fund will be unauthorised, because
they are not within one of the forms of benefits set out in
Pension rule 6 in section 165(1) of FA 2004. Where a
member who was untraceable at age 75 is subsequently
traced, then if their funds have not, within six months, been
used to purchase or provide a scheme pension or annuity,
they will at that point be treated as becoming held as an ASP
fund. The ASP provisions, including the minimum income
requirement, will then start to apply.
