As Britain spends its day wondering about council elections in far flung parts of the country it can’t quite place on a map, let’s take some time out to recap on the week in news.
1) Money to burn
You know how it is, when you buy something, it doesn’t quite work out but you’ve lost the receipt and it turns out you’ve wasted £330m.
That’s where Old Mutual Wealth found itself this week, and unfortunately no amount of rummaging through its wallet could help it out.
The company ditched technology provider IFDS after it ran into problems with its platform upgrade after cost overrruns.
Instead the company has opted to sign a deal with FNZ which already powers Standard Life and Elevate.
The upgrade with IFDS was expected to cost Old Mutual around £450m, whereas the move to FNZ is estimated to cost between £120m and £160m.
At the end of April, the transformation costs amounted to £330m, of which £110m related to the heritage business.
Oh well. If OMW staff have a smaller Christmas do this year, they know who to blame.
2) It’s not that easy being Green
When politicians have grown bored of Brexit, pensions have made their way onto the electoral campaign.
This week Prime Minister Theresa May announced plans to protect the pensions of workers against irresponsible behaviour by company bosses, should the Conservative party win at the general election.
It follows the recent debacle involving BHS and its former owner Sir Philip Green.
Mrs May plans to tighten the rules on the safeguarding of pensions during takeovers, and increase punishments for those caught mismanaging schemes.
A Conservative government would give The Pensions Regulator the power to scrutinise takeovers and unsustainable dividend payments that threaten the solvency of a company pension scheme.
3) Pensions in a right state
Meanwhile there have been calls for more clarity on the positions which the political parties hold on the state pension.
Pension consultancy firm Mercer has called for a formal commitment from all political parties to support those having to work longer before receiving their state pensions.
Meanwhile analysis by Hymans Robertson found pensioners get just £2.04 per week more from the implementation of the triple lock, saying it appeared sensible to maintain it.
Labour has pledged to keep the triple lock but the Conservative party has not yet committed to do so.
4) Rise of the machines
Robo-adviser Wealth Wizards has made a Terminator-style offer to IFAs: “come with me if you want to live”.
It has launched a new automated paraplanner tool to help firms provide retirement advice in less than two hours.
The tool automates at retirement advice with a fact find questionnaire which produces a suitability report.
Wealth Wizards said the tool generates a “regulated advice solution” made up of an annuity, drawdown or a blend of the two.
But the initial reaction seems to suggest advisers would much rather say “hasta la vista”.
5) Tax turns out to be taxing
HM Revenue & Customs is under pressure to clarify its approach to the taxation of pension transfers, three months after an application of its "chargeable lifetime transfer" rules was overturned in court.
In a letter seen by FTAdviser, life company Scottish Widows has urged HMRC to issue new guidance on how it will enforce the rules in the light of an Upper Tribunal ruling in January.
The case in question involved a woman who, following an acrimonious divorce, transferred a portion of a pension she had set up with her husband into a new personal pension.
A few weeks after making the transfer, the woman died.
Because the woman was terminally ill, HMRC treated the transfer as a "chargeable lifetime transfer" and applied inheritance tax.
The woman's estate challenged HMRC and won. HMRC appealed and lost.
Scottish Widows argued clarification from the tax office was needed as the issue was particularly urgent in the light of surging defined benefit to defined contribution pension transfers.
Without clear guidance, the provider claimed advisers were left uncertain over whether their clients were at risk of having hefty taxes charged to their estates.
damian.fantato@ft.com
