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Welfare Reform on the Web (October 1999): Pensions - UK

CHANGING PATTERNS OF PENSION INEQUALITY : THE SHIFT FROM STATE TO PRIVATE SOURCES

J. Ginn and S. Arber

Ageing and Society, vol. 19, 1999, p.319-342

Reform of welfare in the UK has sought to shift the balance of pension provision towards the private sector. Paper examines to what extent this development has widened income inequality among older people, using data from the General Household Survey to assess changes in gender and class inequality in older people's state and private pension income. Results showed that, although state pensions and other benefits remained the major source of income, especially for women, the relative contribution of private pensions to total income had increased substantially for men.

RISKING A SCANDAL

N. Timmins

Financial Times, July 12th 1999, p.16

By proposing that stakeholder pension charges be capped at 1% (too low to allow for good advice) the government is risking a mis-selling scandal. However, the government is now proposed to consider allowing people to hold a stakeholder pension in parallel with other forms of provision such as an occupational pension. If individuals no longer have to choose between a stakeholder pension and an occupational scheme or personal pension, then the need for advice falls away sharply.

STAKEHOLDER PENSIONS : CLEARING ARRANGEMENTS : THEGOVERNMENT'S PROPOSALS

Department of Social Security

London: 1999 (Consultation brief : 3)

Concludes that the best way for employers to pass contributions onto stakeholder pension schemes is for them to make use of the clearing facilities that are already available through commercial banks, bureaux and BACs. This would be simpler and more cost effective than setting up a separate clearing house.

STAKEHOLDER PENSIONS : GOVERNANCE ! THE GOVERNMENT'S PROPOSALS

Department of Social Security

London : 1999 (Consultation brief; 5 )

Proposes that financial services companies should be able to set up stakeholder pensions without trustees providing they appoint a "secure stakeholder manager". The manager would have to set out investment principles for the scheme, produce an annual report, make regular reports to members on the value of the scheme, have arrangements for dealing with disputes, and report to Opra if employers contributed late. An advisory committee could be included in the non-trustee version of the stakeholder pension, and would be able to report to members in addition to the manager

STAKEHOLDER PENSIONS : REGULATION, ADVICE AND INFORMATION ; THE GOVERNMENT'S PROPOSALS

Department of Social Security

London : 1999 (Consultation brief : 4)

Proposes that providers of stakeholder pensions be allowed to charge more than the proposed 1% annual management fee if they provide detailed advice to customers. The extra charge would come in the form of an upfront levy rather than an addition to the annual charge.

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