Money Marketing’s Weekly Must-Reads: Top 10 Stories
This week, Ros Altmann discusses the consequences of removing IHT exemptions for unused pension funds, while campaigners celebrate a victory as HMRC prepares to address the ‘scandal’ of overtaxed pensions.
Ros Altmann: The disaster of removing IHT exemptions for unused pension funds
Ros Altmann critiqued the proposed removal of IHT exemptions on unused pension funds, set to begin in 2027, warning of its disastrous impact on Defined Contribution (DC) pensions.
She highlighted risks including early withdrawals, lower contributions, and reduced pension investment, leading to greater reliance on state benefits. Altmann argued the change undermines pension freedoms and incentivises rapid fund depletion.
With dual taxation potentially exceeding 50%, she urged reconsideration, proposing simpler, fairer alternatives to safeguard pensions and encourage long-term growth investment.
FCA to tear down regulatory barriers in response to government growth calls
The FCA pledged to cut unnecessary regulations and simplify rules following the UK government’s call for pro-growth reforms.
In a letter to the prime minister, chief executive Nikhil Rathi outlined measures including reducing reporting burdens, reforming lending advice rules and making the Senior Managers and Certification Regime more flexible.
The FCA emphasised unlocking capital, supporting digital innovation and facilitating firm growth as part of its strategy through 2030. Recent actions include listing reforms, pension framework updates and strengthening UK market leadership.
Victory for campaigners as HMRC set to address ‘scandal’ of overtaxed pensions
After years of campaigning, HMRC announced it will overhaul its tax system, which has overtaxed pensioners by £1.3bn since 2015.
Under the Pension Freedoms policy, savers could withdraw pension funds in chunks, but HMRC’s use of emergency tax codes often led to overpayments requiring refunds. From April 2025, HMRC will replace these codes with regular tax codes, ensuring accurate real-time deductions and reducing refund claims.
Former pensions minister Steve Webb welcomed the move, calling it long-overdue relief for pension savers.
Firms hoping for Consumer Duty rollback set for ‘disappointment’
Firms hoping for a rollback of Consumer Duty regulations were warned of likely disappointment, as MorganAsh noted minimal changes are expected despite government calls for pro-growth reforms.
While the FCA pledged to remove unnecessary rules, it described the Consumer Duty as central to its strategy and crucial for sustainable growth. Minor changes, such as removing the need for board champions, were confirmed, but core compliance remains.
MorganAsh highlighted persistent challenges in addressing customer vulnerability within financial firms.
Oxford Risk unveils new retirement income suitability solution for advisers
Oxford Risk launched a retirement income suitability tool to help advisers meet stricter FCA requirements following its retirement-income advice review.
The tool aids in information collection, suitability assessments and disclosures, addressing challenges like balancing guaranteed income and investment risk. Growing annuity sales highlight the changing retirement planning landscape. Incorporating data from Just Group, the software offers insights into secure lifetime income (SLI) and portfolio adjustments.
Oxford Risk aims to support advisers in demonstrating suitability and achieving better client outcomes in retirement planning.
M&G Investments brings in ex-AXA boss as new CFO
M&G Investments appointed Marcello Arona as CFO of its asset management division on 13 January 2025.
Arona, with over 20 years of experience at AXA, including roles as UK CEO and US CFO, brings extensive global expertise to the role. Reporting to M&G CFO Kathryn McLeland, he will oversee financial operations and strategy, supporting growth and simplification.
CEO Joseph Pinto praised his proven track record, while Arona highlighted his commitment to enhancing M&G’s integrated business model and delivering value for clients and shareholders.
Investment world divided over Trump’s return to the White House
Donald Trump’s second term as US president, beginning on 20 January 2025, sparked mixed reactions in the investment world.
Nutmeg research revealed 29% of UK investors viewed his presidency as positive, while 31% disagreed. Younger and newer investors were more optimistic about his impact on portfolios. Bitcoin surged to a record $108,000 following Trump’s pro-crypto stance. Policy shifts, particularly on tariffs and cryptocurrency, are anticipated.
Experts advised caution, urging investors to avoid immediate portfolio adjustments and focus on long-term strategies amid uncertainty.
Transact names new CEO as Jonathan Gunby retires
Jonathan Gunby, Transact’s CEO, announced his retirement in March 2025 after 14 years with the firm. Tom Dunbar, chief development officer since 2021, will succeed him.
Gunby played a key role in growing Transact’s funds under direction from £10bn to over £65bn and was instrumental in the company’s 2018 stock market flotation. Dunbar’s leadership and success led to his 2023 board appointment, and now to the CEO role.
Gunby will remain a shareholder and support the business in retirement.
Perspective acquires five more firms and adds £375m AUA
Perspective Financial Group acquired five firms in December 2024, adding £375m in assets under advice and 1,100 client households.
The acquisitions included Hallidays Wealth Management, Foinaven Asset Management, Tony Fenton & Sons, PW Financial Management and a client book from a self-employed adviser. These deals expanded Perspective’s total acquisitions to 107 since 2008 and added three new offices.
CEO Ian Wilkinson praised the firm’s strong year-end performance and reaffirmed its commitment to a selective acquisition strategy in 2025.
UK wage growth rises along with unemployment: expert reaction
UK wage growth rose to 5.6% in January 2025, up from 5.2%, surpassing inflation. However, experts warned of inflationary pressures and potential economic challenges.
Analysts suggested that strong wage growth may not prevent a Bank of England rate cut in February, but if persistent, could prompt rate hikes. Unemployment edged up to 4.4%, while vacancies dropped, indicating slowing hiring.
Experts cautioned about the potential impact of higher employer national insurance contributions on employment and business costs in 2025.
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