The government will put plans to cap charges on workplace pensions on hold for at least a year and may not even implement them during this Parliament, the Financial Times reports.
News of the delay, which the Financial Times says comes from an “informed source” close to the situation, follows a report in FTAdviser sister title Financial Adviser this week (15 January) that the government would push back publication of its strategy for dealing with pension charges for another month.
This first delay, which was confirmed by sources close to The Pension Regulator, was believed to be related to ongoing discussion on what should be included within the charge, and particularly the issue of transaction costs.
Criticisms arose in response to the government’s proposed 0.75 per cent or 1 per cent cap on pension charges when commentators drew attention to the fact that the National Investment Savings Trust would fall above the cap due to its dual charging structure.
Nest charges a low 0.3 per cent AMC but a 1.8 per cent initial contribution charge, which Aviva’s John Lawson has said means its total charges do not fall below 1 per cent until the fifth year of saving.
Pensions minister Steve Webb hinted last year that the cap would not include initial charges in order to exclude Nest being caught. The cap was intended to apply from April this year.
Osborne pushes for minimum wage hike
Chancellor George Osborne has called for a rise in the minimum wage, The Telegraph reports.
According to the paper, Mr Osborne hopes raising minimum wage will compensate low-income workers for the economic crisis, a move the paper speculates is aimed at Labour voters.
Mr Osborne has said the minimum wage should see an above inflation rise and go up from its current level of £6.31 an hour to around £7 an hour.
Labour to challenge big banks
Labour is set to propose creating at least two new big banks with a minimum market share of 12 per cent, The Guardian reports.
In a speech designed to show how breaking up the near-monopoly held by the “big five” banks, the paper predicts Osborne will claim the move is “not for retribution, but for “reform”.
South Korea snubs North offer to cease military drills
South Korea has rejected an offer from North Korea to work towards easing tension which would include the South ceasing combined military drills with the US, the Independent reports.
According to the paper, South Korea has insisted the North must take steps towards nuclear disarmament before it will cancel its drills.
Shell profits hit by high costs
Royal Dutch Shell has warned its fourth-quarter earnings will be “significantly lower” than those of the previous year, the Financial Times reports.
Shell, Europe’s largest oil company by production, was hit by high exploration costs and continued refinancing woes.
