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For decades conventional annuities have been underwritten on the basis of assessing just three factors; age, sex and the fund size. Clients and advisers readily understand this basis, and as a result annuities have been extremely easy to arrange and compare.

The first enhanced annuity, a smoker annuity, appeared in 1995. Since then the market has developed and now many providers now use medical and lifestyle information to try and more accurately assess life expectancy.

In contrast, the philosophy underlying protection products has been developed over decades. Moreover, in recent years the protection arena has been transformed by slicker methods of assessment and acceptance of risk resulting in drastic reductions in processing time and importantly more accurate pricing.

Both annuity and protection products rely on the customer disclosing as much information as possible about their health and lifestyle so the insurer can accurately assess the risk.

However, from the customer perspective there is a much bigger up front risk associated with the annuity.

This is because once arranged an annuity cannot normally be changed or surrendered, so the level of income determined at outset is normally the amount paid for life.

Therefore, capturing all relevant information on a customer’s circumstances at that time is vitally important as this is used to determine the income. .

This question is whether this actually happens?

Except where a report from the customer’s doctor is used (normally for severe medical conditions) enhanced annuity cases are often underwritten with insufficient information at the point of sale to make a truly accurate judgement of the risk involved.

Added to this, automated underwriting systems that use point’s scores and banding structures are often employed to determine the level of enhancement. The end result is that customers often do not get the most appropriate rate for their circumstances

Most annuity underwriters want to be in a position where they are able to quantify, with a reasonable level of confidence the perceived risk and so offer an improved rate, where justified. So are we now at a time where advisers and customers should start to accept the need to disclose more detailed information?

Also, looking at the protection model is there any reason why more efficient data capture techniques could be employed without slowing the annuity application process?

Could the winners be those providers that are able to combine an effective service proposition with a sophisticated risk assessment and as a result offer a fair and truly representative annuity?

There is no doubt that in the next few years the enhanced annuity market will grow and evolve at rapid speed and advisers need to keep a watchful eye on developments.

Tim Gosden is head of product development at Legal & General Individual Annuities

Three days on from the long-awaited RDR and it still doesn’t seem to be getting much of a positive response.

The subject of qualifications in particular, seems to be a sore point, which I learnt from being at a conference filled with unhappy advisers yesterday.

One adviser, in particular, showed an outburst of anger by shouting at Amanda Bowe (who is spearheading the FSA’s delivery of the RDR) when she delivered her speech to the delegates.

He was angry that the FSA continues to target advisers and astonished that the regulator is not taking the same approach with the banks.

Read More »

The eagle has landed and not a minute too soon. As the headaches around the UK’s state pension scheme continues, huge was the outcry in the office when the news hit the wires, that the Pensions Act had finally received royal assent.

The Act which will see regulations around the automatic enrolment into workplace pension schemes, alongside a new system for pension saving for low and moderate earners from 2012, become the law of the land.

The decision by parliament was followed by luring promises from Tory leader David Cameron that the Conservatives will put an end to the “apartheid in pensions” which currently reigns in the UK.

Read More »

Libor, which governs the rates at which banks lend to one another, has dropped and the Bank of England surprised us all with an unexpected decrease in the base rate.

On the face of it, this is good news for the more than depressed mortgage market, but will it bring instant relief for all?

The short answer is probably no!

Not all lenders have passed on the rate cut to borrowers. With the strong possibility of further cuts in 2009, many homeowners may be inclined to make that move they’ve been putting off.

There is an element of ‘chicken and egg’, however, in that we need to stimulate the market for first-time buyers for the rest of the market to start moving. There’s no clear evidence that this segment has been suitably stimulated, with lenders hesitant to offer deals that will be both attractive enough and affordable to those entering the market for the first time.

So, total recovery may yet be some time off. These are difficult times for everyone associated with the mortgage market and many are acknowledging the need to diversify, or in some cases focus more on other opportunities.

You might expect a provider to suggest the need for mortgage brokers to do more protection and yet, many distributor firms are saying exactly the same thing. It’s easy to do what you do best and can do efficiently – in a vibrant mortgage market that means mortgage after mortgage, and few, if any protection sales.

But we’re in a different world and time available from fewer mortgage sales could be spent on meeting a customer’s protection needs, whilst helping to replace lost income.

Whilst you might believe a protection application to be a more time-consuming process, you could be surprised how quick it can be. You can apply via the traditional paper route, although modern online systems can have customers on risk within around 15 minutes, give you a great deal of control over the process – and provide extra commission.

You can look beyond basic life cover and include protection against serious illness and inability to work, covering all your client’s needs within one application whilst increasing your earnings even further.

This could also be the beginning of a long-lasting and rewarding relationship. You not only meet the current needs of your customer in terms of the mortgage and immediate protection, you build in so much value that these customers will come back to you for future protection needs – house moves, family and life style changes and beyond.

According to reinsurer Swiss Re, there is a protection gap of some £2.3trn in terms of sum assured – the difference between what they believe should exist in terms of needs (including debts) and what exists through providers.

Whatever figure you choose to believe, our customers are under-insured – you can make the difference.

Gerry Warner is protection development manager of Zurich UK Life

A new level of trust and consumer confidence should be delivered by the Retail Distribution Review, according to the FSA.

Yesterday, I had the pleasure of reading 220-pages outlining the regulator’s plans to provide greater clarity for consumers about the advice service being offered by making a distinction between independent advice and sales advice. Hmmm… haven’t I heard admirable intentions and plans like those detailed in this latest FSA tome somewhere before?

Those who have been in the industry for more than five minutes will recall depolarisation, which was supposed to clarify for consumers whether they were sat in front of tied, multi-tied or independent advisers. Did it? Let us be frank, no it did not.

Prior to depolarisation the regulator promised to check if forcing advisers to categorise themselves in this way had a positive impact on consumers or if it had just added an extra cost to IFA’s balance sheets.

I lean more towards the latter. The FSA has promised this time to keep a close eye on how intermediaries present their services. I hope this time they do a better job than they did on monitoring the impact of depolarisation.

Consumers need to know what they are getting and it is about time the FSA punished those who claim they are offering more comprehensive advice than they are.

Just hours after the FSA’s feedback statement on the RDR was published a bun-fight has already broken out within the financial services industry.

Unsurprisingly, most of the friction is centred around the lack of clarity between the independent advice and sales models. (Oh, and the fact that the regulator has whacked advisers with new prudential requirements that are double those previously in place.)

Given that the feedback statement is around 220 pages in total, many of us are still ploughing through the minute detail. But on the face of it, the FSA looks to have failed to provide sufficient clarity between the sales and advice models. Read More »

Welcome to FTAdviser’s up-to-the-minute live coverage of Alistair Darling’s Pre-Budget Report speech.

Darling will be speaking before the House of Commons from 3.30pm today (24 November) to announce the government’s latest plans to restore stability to the UK economy and financial markets.

In conjunction with Financial Adviser, we have gathered a panel of leading experts from the financial services sector to provide up-to-the-minute reaction to his speech.

Our panel of experts are:

Pensions: Adrian Boulding, director of pensions strategy, Legal and General

Mortgages: Stewart Hunter, head of intermediary business, Astra Mortgages

Taxation: Brian Murphy, manager, tax & trusts, Axa Life

Inheritance tax: Julie Hutchison, head of estate planning, Standard Life

Read More »

Image is always a thorny issue because it is both critical and nebulous, an awkward combination.

What the “general public” thinks of IFAs is hard to pin down – and therefore hard to improve. For most, the profession is probably off the radar.

For those who are aware of the community, opinions are often limited to personal experience. Mrs Jones may sing the praises of dear Mr Thrift, but most likely has no view of the profession as a whole.

This is the crux of the recruitment problem. It simply doesn’t occur to young people to become financial advisers. Read More »

It is T minus three days(-ish) and counting before Alistair Darling takes to the stage to reveal what ‘goodies’ the Pre-Budget Report has to offer.

The obvious expectation is that the chancellor will cut taxes – the question is where and by how much?

Smith & Williamson predicts Darling could increase national insurance or increase the tax rates for higher earners. Others have speculated that a postponement to the increase in the small companies rate of tax is on the cards.

Meanwhile. KPMG’s head of tax Sue Bonney suggests an increase in the personal allowances aligned to RPI could be announced. (See full predictions here.)

So, given the speculation and reams of newsprint dedicated to the Pre-Budget Report, it’s not surprising that some more speculative, risk-taking ‘investors’ are having a flutter on the outcomes of Monday’s speech.

And, of course, odds on offer at betting agencies include several relating to the much touted potential income tax cuts.

First up is whether there will be a reduction in the rate of employers’ NI contributions. Among others, this is followed by whether the old low rate tax band of 10 per cent will make a comeback, and – of course – whether the 40 per cent top rate of income tax will be reduced.

But given that a bet for NI contributions to be cut is currently only paying 2/5, it’s probably not a financial ‘investment’ many punters will be racing to take.

Some more light-hearted bets on offer include how many sips of water Darling has throughout the speech, as well as what colour tie Darling will wear.

One sip pays 9/4 while two pays out 2/1, while a pink tie is the current favourite, in case you’re wondering?

As always, gambling is not a sound financial decision. But in a totally ‘virtual’ context, I might be inclined to have a flutter on an increase in tax rates for higher earners.

What about you?

As a result of the current financial turmoil, a pre-Christmas dose of fiscal stimulus in the style of British economist John Maynard Keynes appears inevitable.

Those taxpayers felt likely to spend rather than save the tax giveaway, it seems, can look forward to the Pre-Budget report on Monday (24 November) with eager anticipation.

For savers, on the other hand, the news is unlikely to be as good. The Keynesian ‘paradox of thrift’ theory seeks to discourage individual saving as being undesirable for the greater economic good in times of recession.

The inevitability of immediate tax cuts is followed by the equal inevitability that the cuts will need to be paid for in the form of higher taxes and/or lower public spending in the medium term.

What form this payback will take appears, ultimately, to depend on the outcome of the next general election, with some clear blue water appearing between the main parties in terms of tax and spending policies.

Will it be the ‘thrifty’ who bear the brunt of the burden in the form of increased taxes for those fortunate enough to be in a position to save?

Where does this leave the Conservative inheritance tax proposals (assuming they keep their poll lead right up to the election)?

Short and medium term cuts in inheritance tax are not looking favourite in the current environment.

We are, quite rightly, already seeing evidence of increased vigilance when it comes to tax collection with the announcement that HMRC are targeting a further 25 building societies and banks for details of clients’ offshore deposit accounts following on from their amnesty in 2007.

Maximising the tax collected is likely to be a recurring theme.

A focus by the tax authorities on the thrifty could, however, be very good news for advisers with the value of advice becoming even more apparent.

Mark Wilkinson is head of tax and financial planning at AXA Winterthur Wealth Management

It is probably becoming a bit of a cliche now to say that we are living in unprecedented times.

Many advisers with already a few grey hairs are admitting that now is a challenge. Not least because both the stockmarkets and the housing market are going through a rough period, which would tax even the most experienced financial adviser.

But also because financial advisers are having to deal with regulatory change as well, just when they need to focus their attention on their day-to-day business.

The FSA’s RDR feedback statement is going to come out next week, and many are wondering how it will affect their future and how IFAs can present themselves to clients and indeed the future of their business.

Opinions range from the cynical, ‘it won’t affect me’ variety, to the plain anxious and concerned.

However, despite much apprehension over whether the FSA will get it right this time, they have shown so far that they are willing to listen.

At least, as John Gummer said to a gathering of IFAs at last night’s annual Aifa dinner, they have simplified their proposals from the initial suggestions, and the last idea presented to the wider world was that advisers should be split down into sales and advice.

Putting aside questions over whether IFAs should be able to rely on commission, the sales/advice split did seem to be broadly welcomed.

Obviously it would seem to be going back to the days of the direct sales forces and tied advisers, yet those that it calls ’sales’ will be those in the banks with their own sales targets, and concern for the client’s wellbeing some way down the list of priorities.

Nonetheless, if one wants to remain optimistic about it, and see the banks’ sales people in the same light as one would a GP, as one IFA director has put it to me, then we should focus attention on their qualifications, as much as IFAs’.

For many consumers, they represent the entry level to financial advice, and if they are put off by shoddy practice at the first level, then there is not much to be optimistic about when the time comes to get more complex advice.

The base rate could be reduced even further in coming weeks, according to the minutes of the Bank of England’s Monetary Policy Committee meeting.

The minutes of the MPC meeting, at which the base rate was reduced from 4.5 per cent to 3 per cent, showed the Bank’s nine-member committee voted unanimously for the cut on 6 November but considered an even greater one.

The Bank’s own calculations showed a cut to 2.5 per cent, or even less, would be needed to stop inflation falling too far below its target next year.

Is it just me or do you wait ages for a base rate cut and then suddenly a few seem to be coming along all at once?

While a base rate reduction is not to be sniffed at, I just hope if the MPC does go further down this route it explains to the public this rate does not dictate how much we have to pay for our mortgages from banks and building societies.

In the current economic climate it was depressing to have the front pages of newspapers screaming banks were conning customers by failing to pass on the base rate reduction to their borrowers.

Libor, the rate at which banks lend to one another, is what dictates how much we must pay for our home loans, not the base rate.

Restoring confidence in financial services is vital and further base rate cuts and a blame game with the banks will not stop people stuffing their hard earned cash under their mattresses and worrying about the housing market.

If you are reading this blog you are more likely to already be ahead of the game when it comes to online, but there are still a worrying amount of financial firms that have yet to grasp the importance of being online and we must spread the word.

As the financial crisis deepens, it is now more crucial than ever to maximise the efficiency of your business, and a direct contributor to this is effective and targeted marketing.

While sound financial advice is central to a successful business, if you fail to attract new customers when they begin their research process you could be missing out on valuable new business.

Gone are the days where the local press or a directory was the first port of call for finding a mortgage adviser – consumers have migrated to the World Wide Web, and this is not going to change.

It is therefore vital for all financial firms to get online and build themselves a website, which can be found easily, to promote their business.

While some financial organisations have fully embraced the online revolution, it is clear that others are still lagging behind and need to catch up.

Not only is a website a tool to generate new business, but it demonstrates you are serious about your profession.

There is no point having a website that is out of date or that no one can access, so make sure information is updated and highlights to customers why they should come to you instead of your competitors.

You must then ensure your site is best connected with online search engines such as Google, Yahoo and MSN.

There are also other cheap and easy ways to promote your website once you have created it – issuing regular newsletters to customers or even basic measures such as including your web address on all communication that leaves your office such as compliment slips and business cards.

Mentioning your website to clients and spreading the word to your professional connections is also great way to start your website promotion.

Properly monitoring where your enquiries have come from is also key.

By properly I mean really getting to the bottom of where a consumer found you – it’s not enough to say online. Was it direct to your site or was it through a search directory listing your details? Then you can target your spend and effort in the areas that reap you the most rewards.

It is vital, especially in the current market environment that firms stay one step ahead and are doing all they can to promote their business and generate new leads.

Online marketing is the most cost effective and measurable way of doing this.

Karen Barrett is marketing director at Impartial.co.uk

The subject of guaranteed annuity rates usually invokes strong feelings, both in those that have them and those that don’t.

GARs are generally at levels of 9-12% pa, which stacks up very well with the current annuity rate of about 7% pa.

There are some drawbacks to the GAR, of course – usually it is only payable on the exact pre determined retirement date and the pension doesn’t include any spouse’s pension or escalation, but it is probably safe to say that most people take the GAR when it’s available. Read More »

Yesterday was pretty eventful, what with more than 50,000 jobs to go at Citigroup. But the next Monday we all experience could be even more eventful yet.

This is because on Monday 24 November Alistair Darling will unveil the Pre-Budget report.

If speculation turns out to be true, the UK could soon be witnessing tax cuts for low income families. But, for now, the government is staying quiet on just what the tax cuts will be.

All we do know, however, is that this Pre-Budget report will be aimed at addressing the economic problems in the UK economy and Gordon Brown and Alistair Darling have already said they will cut taxes to help bring the UK back from the brink.

Looking at what analysts are saying, such tax cuts will be aimed at those who will actually spend the additional income that any tax cuts would bring, rather than those who would save it.

It’s possible that VAT and income tax could be reduced, according to some analysts.

But income tax cuts are little use to those who have already lost their jobs – so what is the government going to do for them?

One member of my family alone has lost their job to the credit crisis and another family member has lost a chunk of his income because his working hours have been reduced.

So will the package be a mammoth one which prevents the current recession from turning into a depression?

Tell us what you think here and check FTAdviser.com for news on the Pre-Budget report as it happens at 3.30pm on Monday 24 November.

Although we here at Young Adviser have said before that the industry desperately needs 10,000 IFAs, new data released from financial analyst Plimsoll Publishing has again reiterated the idea.

In the group’s latest report, it stated that, in 2009, we will see a wave of retirements from the industry, with 470 of the 2900 directors working in the independent financial advisors market hitting retirement age, most of these having spent a lifetime in the industry.

So, with the old timers off to play golf and travel around with the missus for their golden years, how do we attract the next generation?

Jonathan Purle, director at London-based independent financial advisers Intethic, said the IFA industry needs to follow the example of other professional services sectors and introduce graduate training and apprenticeships to overcome what many see as a difficult industry to break into once they have some job experience and qualifications.

Mr Purle said: “Nobody decides at 29 they’re going to become, for example, a chartered accountant and try to gain entry on the basis of a few book-keeping qualifications – then complain at high barriers to entry when turned away.

“These days, you join as a graduate trainee, commit to higher-level study and do a job where you can add value and not just be a training drag while the firm supports you on a long route to qualifying.”

By trainees doing back-office jobs, this would ensure the attraction of new blood without having to force out people close to retirement early.

Another day, another set of job cuts. This time it’s RBS that’s preparing to cull hundreds of jobs across its global businesses in the coming weeks.

Added to Financial Adviser’s scoop yesterday that Friends Provident is to implement a swathe of redundancies as it closes its Manchester head office and Money Management’s exclusive that 300 jobs are also on the chopping block at Bank of America’s mortgage intermediary arm Loans.co.uk, its been a rather bad week for financial services.

Unfortunately no end to such relentless, despairing news appears to be in sight.

This week the government also confirmed that unemployment has already risen by 140,000 over the third quarter, bringing unemployment to 1.82 million. Meanwhile, the Morgan McKinley London Employment Monitor reported that new job vacancies within London’s financial services sector have plummeted by 48 per cent over the last year.

But are such extreme job cuts really necessary? Or could some be saved by tightening the belt elsewhere?

For example, I can only imagine how RBS’s staff are feeling given that this week has also seen the bank plagued by stories of glitzy parties at its Gogarburn headquarters and speculation that it is to spend £1m on staff Christmas parties.

Job cuts go hand-in-hand with a recession. As such, it’s an easy bet that many more are to come before the UK begins the long crawl out of its current slump.

But in a sector where staff members’ acquired knowledge can be a company’s most valuable asset and profitable tool, we shouldn’t be too quick to jump to such drastic measures.

Perhaps New Star’s cost cutting lead, which has seen it begin sub-letting surplus premises and renegotiating the terms of its debts, would be a better example to follow.

What do you think? Cost cutting tips on a postcard (or just a post) please.

Could the UK repeat Japan’s 1990s experience of minimal growth, falling asset prices and deflation?

Both countries share similar characteristics prior to the initial downturn. Unemployment was low and inflation was under control, but just starting to rise. Asset prices soared, driven by increased borrowing.

While there are similarities, there are also some important differences. The UK does not suffer from Japan’s excess capacity created by overinvestment. Unfortunately, the UK also has some less favourable characteristics. It starts the downturn with a weaker fiscal position than Japan and a very low household saving rate.

With hindsight the Bank of Japan was far too slow to cut interest rates. Certainly Japan didn’t face the seizing up of credit markets currently afflicting the UK and global economy. The first major bank crisis didn’t happen until 1994 with the failure of two urban credit cooperatives.

Full-scale deflation didn’t begin until the onset of the severe recession in 1997-98.

Events have unfolded much more abruptly in the UK than in Japan. The economy and the financial sector are adjusting rapidly. Unemployment is rising sharply and there have already been several high profile banking restructurings.

A combination of a different regulatory and political structure than Japan and intense market pressure is forcing rapid change of the UK financial system.

Crucially, the UK has a symmetrical inflation target. As inflation falls, we think interest rates will be cut even faster, reaching 2 per cent by the middle of next year.

If this fails to stabilize the economy, then rates could fall further, perhaps to 1 per cent. Even if rates drop to zero, there are several unorthodox measures a central bank can use. The most extreme involves printing money although this does risk an uncontrolled surge in inflation.

While deflation should be avoided, a period of weak UK growth now seems inevitable. UK household wealth has suffered a significant decline following the collapse in house prices and stock markets. This is likely to trigger a rise in saving. Lower interest rates will reduce mortgage repayments, but with unemployment rising, consumption growth is likely to be sluggish for some time.

Tim Drayson is an economist at Legal & General Investment Management

Over the last year, the much-discussed reforms of retail financial distribution have been overtaken by what the late Harold Macmillan called ‘events’.

But, those of a stout disposition should not be down-hearted. There is a lot more to come out of the national conversation yet, far more than the restricted, narrow, top-down structures being imposed by the Financial Services Authority and its proselytising disciples in the field.

Like missionaries, they are preaching the virtues of formal qualifications and the great desire to re-construct the industry in to a version of solicitors or accountants. We need to look forward, not backwards.

The problem with both these and other similar old professional models is that neither the originals nor the proposed financial advice version is fit for purpose.

Let us look at solicitors, the most inappropriate and dysfunctional of the models. Some of us may remember when to be a solicitor (or accountant) one had to be articled to an older practitioner, serve out an apprenticeship (what an old fashioned word), before being let loose on the great British public.

The profession had two distinct branches which determined not only status, but contact with the public. Barristers, in their wigs and robes, had exclusive access to the higher courts, while the public had to go through a solicitor to get access to a barrister.

Reforms over a decade ago created the new profession of solicitor-advocate, with access to the high courts; solicitors can now also be Queens’ Counsels and may even be appointed high court judges.

Further, since the Clementi Review of legal services in 2004, there has been a move towards multi-disciplinary services, the so-called Tesco proposals.

We have also seen the post-Enron new approaches to accounting, from fair value to market value and everything in between.

By opting for these conservative, outdated models of professionalism the RDR is in danger of missing the boat.

The current turbulence in the financial markets tell the story: banks in trouble, car manufacturers going cap in hand to Capitol Hill begging to be bailed out and the airline sector about to crash – all based on traditional business models.

The successful global businesses are based on mavericks: Microsoft, Google, Dyson, Virgin (the exception among airlines) – all created by innovative risk-takers and continue to operate in non-conventional ways.

A regulatory straight jacket will stifle innovation, prevent advisers from being innovative and, most of all, stop providers from designing products to fit the needs of clients.

Whatever happens, we must not allow November 25 to be D-Day, the moment when innovation stops and box-ticking begins.

The industry must not allow the global financial crisis to put a premature stop to a continuing robust debate on how best to advise individuals on their financial needs and the products to meet those need.

The UK independent financial adviser market is set to be affected by zero growth in 2009.

This is despite sales growth running at over 7.5 per cent so far this year, which is apparently up on the previous year.

But because of expectations that this will flatten out to stagnant levels next year, around 5,000 jobs are now predicted to go within the IFA industry in 2009.

Not exactly cheery stuff – but this is just the opinion of senior analyst David Pattison at Plimsoll.

And as we have seen in the past year not all predictions turn out to be true. I seem to recall talk around Easter time that the worst of the credit crisis was over.

Anyway, I digress.

But what this analyst also predicts is a changing IFA industry landscape.

He estimates that 470 company directors will retire in 2009 and suggests that this will force many firms to consider whether to stay independent or not, with the end result being that some smaller firms will be acquired by larger ones.

As Pattison says: “Opportunity then, for those wishing to seize the moment and acquire one of these businesses, a clear way to gain and advantage on your competitors in 2009.”

So, is 2009 going to be a year which changes the very landscape of the IFA industry with small firms being bought up by larger one?

Can the small IFA firm survive the credit crisis? What do you think?

Last week, the Bank of England cut interest rates by 1.5 per cent, a move that we welcomed.

Clearly a rate cut was no surprise – there has been a marked deterioration in economic activity indicators in recent weeks as well as sharp falls in commodity prices.

From our point of view, a key area of interest is the effect the interest rate cut will have on mortgage rates and the housing market.

In recent months, limited availability of mortgage credit and high mortgage interest rates have contributed to depressed levels of housing market transactions.

In the most recent Rics housing market survey for September, surveyors were reporting an average of 11.5 completed sales over the last three months, down from 24 sales in September 2007.

This month’s large reduction in interest rates should enable mortgage lenders to pass on some of the benefit to new borrowers. In turn, that should provide important support for buyer confidence and encourage some activity back into the housing market.

Indeed, testament to the power of anticipated reductions in mortgage rates was the reported surge in activity on the rightmove website in the hours following this month’s interest rate announcement.

So far, though, the news on mortgage rates has been better for existing borrowers – those on tracker rates will benefit and some lenders have also agreed to pass-on the rate cut in full to their standard variable rates

By contrast, most tracker rate mortgages for new borrowers have been pulled and are under review while there have only been small reductions in a few fixed rate mortgage deals.

We certainly hope that high street banks will take the opportunity to review all their mortgage rates for new borrowers over the next few weeks.

Further interest rate cuts by the MPC almost certainly lie in the pipeline and the prospect of lower mortgage rates for new buyers in months to come will be a key factor in reversing the current gloomy sentiment surrounding the housing market.

Brigid O’Leary is a senior economist at RICS

We all know it is important for aspiring financial advisers to pave their path to professionalism with qualifications. But the vast array of trade membership bodies, qualification providers and types of exams is making that task a minefield to navigate, not to mention a costly exercise for IFA students to take on without the guarantee that their course of action will hit the mark with prospective employers.

Paul Gough, head of retail financial services at industry advisory group BDO Stoy Hayward, says until the FSA bites the bullet and concentrates qualification options for new advisers, it could fail in its lofty aim to increase industry professionalism and consumer trust in IFAs.

He says: “How to attract and support the next generation of IFAs is to create one body with one set of exams and give them the status they merit. My fear is that there are too many trade associations and exam bodies so young advisers do not know if they have the best qualifications, those that employers want. If there are too many qualification bodies, the public gets confused and are not able to appreciate that the adviser has reached the same professional level, as say a chartered accountant.”

However, he concedes that the RDR’s apparent focus on ethics rather than the myriad qualification administrators is unlikely to shift, not least because they each “have a huge powerbase to lobby the FSA with”.

These bodies include –a tsunami of acronyms – AIFA, CII, IFS, PFS, SII, IFP, CFA, and that is before you consider the mortgage broker qualification providers. Mr Gough believes that exams for investment management, for example, should be limited to just two providers.

As always, we are keen to hear you views. Do you agree that the FSA should step in and limit the number of qualification providers? Or do you believe competition in this space breeds welcomed diversity of choice?

At midday yesterday, I was sitting at my desk frantically preparing for the interest rate decision that was imminent.

I was preparing to write a sentence that began: “The rate decision was welcomed but could have gone further,” but then I was taken completely by surprise.

I, and lots of other people certainly weren’t expecting the MPC to be so brave and slash interest rates by 1.5 per cent. But they did.

Obviously there was going to be some kind of rate cut but this was a pretty decent one, and in terms of cash, a 1.5 per cent reduction in a mortgage rate would actually add up to quite a lot.

But of course, there was the usual flood of e-mails to my inbox, with some people airing their discontent about the rate cut.

Not because it didn’t got far enough (for a change) but because it may actually have no impact on the end consumer.

Who knows if the lenders are going to pass on the rate cut this time and there are lots of people who are sceptical. But it would be pretty shameful if they didn’t at least, pass on some of it to struggling homeowners.

They have already been urged by chancellor Alistair Darling to be nice to borrowers facing arrears, and today Gordon Brown has held a meeting with the banks to tell them that they really need to start being a little less greedy, although im sure his word choice was a little different.

Cut interest rates for borrowers and maybe some will be saved from repossession, that’s what I say.

But of course on the other hand we have the lenders who are wrestling with their own demons and are happy to shrink their mortgage book and get rid of risky customers because they are struggling to find funding.

So who will win, the homeowners who are in need of being thrown a penny or two by their lenders, or the, dare I say it, “greedy banks.”

No-one ever thought that implementing pensions reform was going to be simple.

Automatically enrolling employees into a pension scheme and paying a contribution for them should be a ‘walk in the park’.

But like so many things in life, when you take a step back and consider how it will work in practice, life gets tricky.

The principle that each employee should get a minimum contribution is a sound one. The government has set this minimum as 8 per cent of a band of total earnings, including bonus, commission, and overtime.

The rub comes because most employers work out contributions to private pension schemes using basic earnings. It’s rare for them to base contributions on full salary, and even rarer to only pay contributions on a band of earnings.

So, the industry has argued long and hard over the last 11 months in an attempt to find an easy solution to this dilemma.

The good news is the government is now listening. It has agreed to introduce the option of self-certification for employers. And if employers are confident their pension contributions for all members is greater than the minimum, it’s possible no calculations will need to be carried out.

However, before we hang out the banners in celebration, we need to be sure this option works in practice.

Our aim has to be to eradicate the need for employers who already offer a good pension scheme to carry out yearly calculations. Forcing employers through bureaucratic hoops will only run the risk that employers level down to the Government benchmark, meaning low earners – a disproportionate number of whom are women – could be hit hardest.

Businesses are there to cut hair, repair cars, and fly planes. Not to run pension schemes.
We need to carry on working with the government to find the path of least resistance to make sure employers continue to offer good quality pension plans to their employees.

Rachel Vahey is head of pensions development at Aegon

As the world composes itself from its Barack binge, the looming question which remains alongside popped corks, election balloons and the mandatory celebratory (or for that matter sorrow drowning) hangover, is whether the 47-year old can restore economic stability to the American economy and for that matter the world?

While the markets were hardly favourable to the news of Obamas’ victory with equities falling and the dollar weakening, as the American economy continues to spiral into further disarray, can one man restore confidence in the financial system?

Well, if Gordon Brown was to be believed when he said “now is no time for a novice” then Obama does not have much hope given his limited experience compared to previous US presidents.

Then again – join the ever growing club that feels for all his experience, Brown has made a few irrefutable cock-ups. Novice or old hand – as the prospect of worldwide recession becomes more real everyday with unemployment rising and consumer confidence dropping – has the damage been done?

Many in the know feel it has and predict that things will be very tough for the US over the next few years with ludicrous debt making an early retirement unlikely for the typical US baby boomer.

That said – according to a CNN exit poll, 42 percent of voters said that the US’s financial woes had finally become frightening enough to eclipse such concerns as gay marriage, while 30 percent said that the body count in Iraq outweighed long ideological debates over abortion.

The poll also found that 28 percent of voters were reportedly too busy paying off medial bills, desperately trying not to lose their homes, to dismiss Obama any longer.

Strange how when faced with the collapse of a country and the prospect of not being able to put food on the table – ideological preconceptions and party loyalties disappear into the abyss, even for hardheaded Yanks.

Election euphoria aside – is it time that the UK starts thinking about bringing in a “novice”? More importantly, will it help?