Retirement firms warn Osborne's Budget pensions reform could hit sales growth
Wednesday 09 April 2014
Two of the City’s retirement companies have warned George Osborne’s decision to stop forcing people to buy annuities with pension savings will have "material effect" on sales growth.
Partnership Assurance — which also revealed it had handed its chief executive a 25% pay rise — and Just Retirement both admitted that sales would be hit, at least in the short term.
The two firms specialise in “non-traditional” annuities which can provide a better income for people like smokers or those with health conditions, although they have other businesses as well.
In a trading update, Just Retirement warned that the Chancellor’s unexpected move in last month’s Budget — which prompted shares across the industry to dive — was “having a material effect” on annuity volumes, and admitted that its forecast of 7% sales growth was now “no longer appropriate”.
Partnership Assurance told a similar story in a surprise letter from chairman Chris Gibson-Smith published alongside its annual report. He said: “Over the short term, until the implications of the proposed changes are fully understood, it is likely that we will see a reduction in the sales of our individual retirement annuities.”
Partnership is keeping its dividend policy “under review” until the impact of the changes becomes clear. However both companies said the changes could ultimately prove beneficial, particularly if people are encouraged to shop around more.
The pay hike for Partnership boss Steve Groves means his basic salary soared to £625,000 from £500,000. His bonus was held at £750,000 but he also had options over shares worth £1.25 million set aside.
Just Retirement separately said it had made a final salary scheme “pension de-risking” deal worth £36 million to the company.
- 1 Rape threats, death threats and a police investigation after video poking fun at an Islamic Party in Malaysia goes viral
- 2 Katie Hopkins attacked me on Twitter — so I reported her to the police for inciting racial hatred
- 3 Gamers confess the worst things they've done in The Sims
- 4 6-year-old writes ice cold Valentine's card to his stepmother
- 5 Syrian child photographed 'surrendering to camera because she thought it was a gun'
Rape threats, death threats and a police investigation after video poking fun at an Islamic Party in Malaysia goes viral
Why Robin Williams safeguarded himself against a morbid trend in advertising
Ohio Democrat Teresa Fedor speaks out during abortion debate to reveal she has been raped – and is interrupted by laughter from Republicans
Jeremy Clarkson to become 'special adviser on transport' to David Cameron
Exploding head syndrome: One-fifth of US college students suffer from ailment, study finds
Katie Hopkins attacked me on Twitter — so I reported her to the police for inciting racial hatred
Street preacher quoting from the Bible fined for calling homosexuality an 'abomination'
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
Revealed: Putin's army of pro-Kremlin bloggers
Katie Hopkins reported to the police for race hatred by Labour MP Simon Danczuk after tweet about Pakistani men
iJobs Money & Business
£20000 per annum + commission: SThree: Sthree have an exciting opportunity for...
£18000 - £32000 per annum: Recruitment Genius: A Telesales Executive is requir...
£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, glo...
£50,000 - £55,000: Neil Pavier: Are you a professionally qualified commercial ...