The government has ruled out topping up a pensions lifeboat fund with surplus unclaimed pensions cash from life insurers, ie it has ruled out theft of private money for use in public expenditure.
Andrew Young, of the Government Actuary's Department, said that non-tax sources of funding for the Financial Assistance Scheme FAS (inherited estate orphan assets, windfall taxes or an extension of existing levies on solvent occupational pension schemes) were largely unsuitable.
He noted that there would be:
"substantial legislative and administrative barriers to establishing such a scheme".
How annoying when the law blocks government plans for theft!
You can be assured that this will not be the last that we hear of this scheme, and that the government will be doing its best to try to find a way around these "legal obstacles".
Showing posts with label inherited estate. Show all posts
Showing posts with label inherited estate. Show all posts
Tuesday, July 17, 2007
Tuesday, January 16, 2007
Prudential's Inherited Estate
Those of you with shares in Prudential may find themselves a little better off in the future, thanks to the £9BN of inherited estate sitting in Prudential's books.
However, as with all things in the financial service industry, there is a catch; therefore don't crack open the champagne just yet.
The Prudential is now looking for a senior figure to represent the interests of policyholders, before making any move on the inherited estate. This is the first step required to free up the surplus funds.
The inherited estate is a dormant pot of money that has built up in the life fund over decades, that Prudential does not need to meet its obligations to policyholders.
However, in order to free it up, the Prudential would need the approval of the Financial Services Authority (FSA) which would need to be satisfied that policy holders have been fairly treated.
The next step would be for Prudential to count a proportion of it as capital, not move it out. This would give the Pru some more flexibility.
Analysts at Merrill Lynch claim that freeing up the inherited estate could be worth £2.5BN to shareholders, that's an extra £1 a share.
We shall see!
However, as with all things in the financial service industry, there is a catch; therefore don't crack open the champagne just yet.
The Prudential is now looking for a senior figure to represent the interests of policyholders, before making any move on the inherited estate. This is the first step required to free up the surplus funds.
The inherited estate is a dormant pot of money that has built up in the life fund over decades, that Prudential does not need to meet its obligations to policyholders.
However, in order to free it up, the Prudential would need the approval of the Financial Services Authority (FSA) which would need to be satisfied that policy holders have been fairly treated.
The next step would be for Prudential to count a proportion of it as capital, not move it out. This would give the Pru some more flexibility.
Analysts at Merrill Lynch claim that freeing up the inherited estate could be worth £2.5BN to shareholders, that's an extra £1 a share.
We shall see!
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