Money Marketing’s Weekly Must-Reads: Top 10 Stories
This week: Reaction to the government delaying phase two of the pensions review and backlash over its rejection of compensation for Waspi women.
Reaction as government delays phase two of pensions review
The government delayed phase two of its pensions review, deferring plans to lower the auto-enrolment age to 18, remove the earnings threshold and increase contributions from 8% to 12% of earnings.
Experts, including Tom Selby and Calum Cooper, warned the delay risks leaving millions with inadequate retirement savings and undermines confidence in systemic reform. Calls emerged for an independent pensions commission to tackle the issue.
Industry leaders highlighted the urgency of addressing the UK’s pension savings crisis to prevent future income shortfalls.
Government rejection of compensation for Waspi women sparks backlash
The government rejected financial compensation for Waspi women affected by state pension age changes, despite a Parliamentary Ombudsman report citing maladministration.
Work and pensions secretary Liz Kendall argued compensation of up to £10.5bn was neither “fair nor proportionate” to taxpayers. Campaigners and MPs condemned the decision, with Angela Madden of Waspi calling it “bizarre and unjustified.” Critics claimed inadequate notice caused financial hardship for millions.
Former pensions minister Steve Webb warned the rejection undermines trust in the Ombudsman’s authority.
Are Sipps losing their traditional appeal?
Self-invested personal pensions (Sipps) evolved from niche retirement products into mainstream options, catering to diverse customer needs.
Space’s research found marketing now highlights investment solutions over wide investment choice or retirement planning. Regulatory changes have restricted non-standard investments, with 90% of Sipps operating on a streamlined basis. Commercial property remains common in advised Sipps, while fintechs integrate app-based versions.
Critics question whether Sipps remain retirement vehicles or have become general investment products, though they retain tax advantages for retirement savings.
FCA seeks to ban and fine two advisers for pension transfer failings
The FCA provisionally fined advisers Richard Fenech and Heather Dunne £270,646 and £399,817 respectively, and sought to ban them for using a flawed advice model for pension transfers.
Dunne advised 92% of her clients to transfer defined benefit pensions, often against their best interests, transferring over £126m. Fenech failed to oversee Dunne or address compliance warnings about the two-adviser model, which left customers at significant financial risk.
Both advisers appealed to the Upper Tribunal, delaying enforcement.
FCA proposes rule change on information supplied to investors
The FCA proposed simplifying investor information to boost confidence and drive investment.
It plans to replace EU-inherited rules, which require standardised but often unclear investment documents, with a flexible UK-specific system. Firms would have more choice in communicating essential details, helping consumers make informed decisions. The regulator also aims to ensure market consistency while encouraging innovation.
The Investment Association welcomed the initiative, emphasising its potential to foster inclusive investment. Stakeholders have until 20 March 2025 to respond.
Titan Wealth buys IWP to strengthen financial advisory offering
Titan Wealth acquired Independent Wealth Planners (IWP) for an undisclosed sum, adding £6.6bn in client assets and boosting its total assets under management to £35bn.
The deal, pending regulatory approval, accelerates Titan Wealth’s vertically integrated strategy, combining financial advice with investment management and custody solutions. IWP, with 107 advisers across the UK, sees the partnership as enhancing client service and growth opportunities.
Titan Wealth’s founders hailed the acquisition as a milestone, uniting expertise to deliver improved client outcomes and services.
Quilter adds three AR firms to advice network
Quilter Financial Planning expanded its advice network by adding three appointed representative firms: Efinity Wealth Ltd, Harris & Co Wealth Management and Secure Financial Planning Ltd.
The firms, based in Cheshire, Belfast and Milton Keynes, bring extensive financial services experience, with principals Charles Davies, Ross Harris and Manisha and Kalpesh Savdas leading. This followed the addition of five firms earlier in December.
Managing director Stephen Fryett expressed enthusiasm for supporting their growth as Quilter oversees £116.2bn in customer investments across its wealth management segments.
‘They are watching you’: Regulation in 2024
In 2024, financial regulation underwent significant transformation. The FCA’s Consumer Duty catalysed numerous changes, starting with February’s investigation into firms charging for undelivered ongoing advice, impacting over 6,000 clients and prompting St James’s Place to set aside £426m for claims.
Following Labour’s election win, proposals to simplify the FCA handbook emerged, aiming to reduce complexity and costs. Crackdowns on financial influencers and a review of M&A activity highlighted ongoing scrutiny. By year-end, regulatory vigilance remained a central theme across the industry.
Advice tech firm completes MBO from Abrdn
Advice tech firm Focus Business Solutions completed its management buyout (MBO) from Abrdn, led by Dave Upton, who became CEO.
The move marked a return to independence after 14 years under a FTSE-listed parent. Focus aims to expand its client base and drive industry transformation with its advice automation technology. The firm serves major UK clients using its Azure-based platform to improve advice delivery.
Abrdn remains a minority investor and valued customer, while Focus plans to introduce innovative products for growth.
The Openwork Partnership hires CFO from Rathbones
The Openwork Partnership appointed Jennifer Mathias as its new CFO, following her tenure as Group CFO at Rathbones Group.
Mathias also held leadership roles at EFG Private Bank and Coutts. Her appointment coincided with Bain Capital’s significant minority investment in Openwork, subject to regulatory approval. CEO Philip Howell highlighted Mathias’s expertise in the sector to support Openwork’s growth strategy.
Openwork, one of the UK’s largest financial services networks, provides advice across wealth management, mortgages and protection sectors.
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