2016 / 2017 · PDF fileAquila Heywood Chantler Kent ... fairer society – where people...

A Y E A R I N P E R S P E C T I V E

2016 / 2017

©2017 WESTMINSTER PUBLICATIONS www.theparliamentaryreview.co.uk

WORK & PENSIONS

F O R E W O R D S

Th e Rt Hon Th eresa May MPTh e Rt Hon Philip Hammond MPTh e Rt Hon David Gauke MP

R E P R E S E N T A T I V E S

Grove Pension Solutions

Blue Sky Financial Planning

Harris Begley

Smith & Pinching

D G Pryde

Goodmans Financial Planning

P W H Financial Planning

Premier Financial Management

Primetime Retirement

Westerby Trustee Services

Whichers IFA

Aquila Heywood

Chantler Kent Investments

Punter Southall Health and Protection

F E A T U R E S

Review of the YearReview of Parliament

http://www.theparliamentaryreview.co.uk/

1FOREWORD | 1

Foreword

This year’s Parliamentary Review follows a significant year in British politics. It was a year in which our economy continued to grow, as the Government followed its balanced plan to keep the public finances under control while investing to build a stronger economy. It was a year in which we began to deliver on the result of the EU referendum by triggering Article 50 and publishing the Repeal Bill, which will allow for a smooth and orderly transition as the UK leaves the EU, maximising certainty for individuals and businesses.

And, of course, it was a year in which the General Election showed that parts of our country remain divided and laid a fresh challenge to all of us involved in politics to resolve our differences, deal with injustices and take, not shirk, the big decisions.

That is why our programme for government for the coming year is about recognising and grasping the opportunities that lie ahead for the United Kingdom as we leave the EU. The referendum vote last year was not just a vote to leave the EU – it was a profound and justified expression that our country often does not work the way it should for millions of ordinary working families. So we need to deliver a Brexit deal that works for all parts of the UK, while continuing to build a stronger, fairer country by strengthening our economy, tackling injustice and promoting opportunity and aspiration.

In the year ahead we will continue to bring down the deficit so that young people do not spend most of their working lives paying for our failure to live within our means. We will take action to build a stronger economy so that we can improve people’s living standards and fund the public services on which we all depend. We will continue with our modern Industrial Strategy,

deliver the next phase of high-speed rail, improve our energy infrastructure and support the development of automated vehicles and satellite technology, building a modern economy which creates the high-skill jobs of the future.

At the same time, work needs to be done to build a fairer society – where people can go as far as their talents will take them and no one is held back because of their background. So we will continue to work to ensure every child has the opportunity to attend a good school. We will continue to invest in the NHS and reform mental health legislation, making this a priority. And we will work to address the challenges of social care for our ageing population, bringing forward proposals for consultation to build widespread support.

So this is a Government determined to deliver the best Brexit deal, intent on building a stronger economy and a fairer society, committed to keeping our country safe, enhancing our standing in the wider world, and bringing our United Kingdom closer together. We will continue to put ourselves at the service of millions of ordinary working people for whom we will work every day in the national interest.

Th e Rt Hon Th eresa May MPPrime Minister

This year’s Parliamentary Review follows a significant year in British politics

“ “

| FOREWORD2

Foreword

It’s been a long road back for the British economy. In 2009 our deficit was at a post-war high, our economy shrank by 4.3% and millions feared for their jobs. Thanks to the hard work of the British people since then, we have reduced the deficit by three-quarters, we have been the second fastest growing G7 economy for the past two years, 2.9 million net new jobs have been created and our employment rate is the highest ever recorded.

By controlling our public spending, backing business and creating the environment for enterprise and investment to thrive, we have got the UK economy back on track.

But now we face new challenges. The deficit is down but debt is still too high. Unemployment is at a 40-year low, but real pay growth is stagnating. And I understand that people are weary of the hard slog of repairing the damage caused by Labour’s great recession.

All our progress could be put at risk if we listen to those who say we should abandon the economic plan that has brought us so far, just as we are coming to the final furlong. And it is up to all of us, in business and in Government, across every sector covered by The Parliamentary Review, to make the case, all over again, for a market economy, sound money and a system that incentivises enterprise and innovation.

So I will stick to the plan to bring the public finances back to balance, at a pace that supports the economy in the face of short-term challenges, and to make longer-term changes. I will pursue a Brexit outcome that puts jobs and prosperity first. And I will continue with my priority to build a productive and dynamic economy.

It is only by making sustained increases to our productivity that we can deliver the higher wages that will increase living standards and fund the improvement of our public services. That is why I announced the £23 billion of additional investment in infrastructure and innovation at the Autumn Statement last year, and why I launched an overhaul of our technical education system at the Spring Budget.

It is a good start, but there is more to do if we are to close the productivity gap with our competitors, and build a strong economy to provide opportunity, prosperity and the funding for public services that this country needs. I am determined to get on with the job.

This is how we can unlock the full potential of our economy and create an economy that works for everyone.

Th e Rt Hon Philip Hammond MPChancellor of the Exchequer

We have been the second fastest growing G7 economy for the past two years

“ “

3FOREWORD | 3

Foreword

I am delighted to have been asked to introduce the first Work and Pensions edition of The Parliamentary Review. Work and Pensions policy has an extraordinary reach that touches everyone in this country at some point in their lives. It is fitting that we reflect on progress in this brief, both inside and outside parliament, over the last year and look forward to the challenges ahead.

This is an unusual and dynamic time to be serving in government and parliament. The year in Westminster has been characterised by change, with the Prime Minister’s snap election rounding off a year of reverberations following the referendum result in June 2016.

As a parliament, and as a country at large, we have all been considering the ramifications of leaving the EU, and how a stable, prosperous post-Brexit future can be achieved. In this context, the work of my department is more important than ever. We play a crucial role in providing continuity, stability and safeguards for the country’s working and living arrangements – whether that be administering state pension payments to over 13 million people each week, or providing maternity payments totalling £2.9 billion each year.

As our departure from the EU will alter the labour market, it is up to my department and others to support the workforce, enhance the economy, seek opportunities for trade and ensure we are match-fit for a post-Brexit world.

The work already undertaken by this department has helped the UK achieve the joint-highest rate of employment since records began, alongside the highest rates of employment for both women and disabled people. Our flagship welfare reform, Universal Credit, ensures that it always pays to be in work rather than

on benefits. We have just celebrated the rollout of this initiative reaching over 100 job centres, and will continue to expand its availability and uptake in the year ahead.

In the upcoming parliamentary year, we will continue simplifying the benefits system, and also work to embed clarity and sustainability in other areas of social security. We continue to improve confidence and transparency in the maintenance arrangements for children of separated parents, by closing legacy schemes and encouraging and incentivising parental collaboration. We will pursue our commitment to help people with disabilities get into, and stay in, work, building on the 300,000 who have joined the workforce in the last year. We have already announced plans to raise the state pension age to 68 in 2037, in a move that will rebalance generational fairness and enhance provision for people in old age. The continued uptake of the workplace pension supports this drive for strategic planning and long-term sustainability.

Optimising and incentivising our work and pensions provision is vital because we need a clear and sustainable system in a post-Brexit world – one that galvanises the workforce and enriches the economy, while supporting the most vulnerable. By getting protections, benefits and incentives right at home, we can build our productivity, presenting a Britain that is ready to do business, and open to engagement with the rest of the world.

The work of my department is more important than ever

“ “Th e Rt Hon David Gauke MPSecretary of State for Work and Pensions

3FOREWORD | 3

Foreword

I am delighted to have been asked to introduce the first Work and Pensions edition of The Parliamentary Review. Work and Pensions policy has an extraordinary reach that touches everyone in this country at some point in their lives. It is fitting that we reflect on progress in this brief, both inside and outside parliament, over the last year and look forward to the challenges ahead.

This is an unusual and dynamic time to be serving in government and parliament. The year in Westminster has been characterised by change, with the Prime Minister’s snap election rounding off a year of reverberations following the referendum result in June 2016.

As a parliament, and as a country at large, we have all been considering the ramifications of leaving the EU, and how a stable, prosperous post-Brexit future can be achieved. In this context, the work of my department is more important than ever. We play a crucial role in providing continuity, stability and safeguards for the country’s working and living arrangements – whether that be administering state pension payments to over 13 million people each week, or providing maternity payments totalling £2.9 billion each year.

As our departure from the EU will alter the labour market, it is up to my department and others to support the workforce, enhance the economy, seek opportunities for trade and ensure we are match-fit for a post-Brexit world.

The work already undertaken by this department has helped the UK achieve the joint-highest rate of employment since records began, alongside the highest rates of employment for both women and disabled people. Our flagship welfare reform, Universal Credit, ensures that it always pays to be in work rather than

on benefits. We have just celebrated the rollout of this initiative reaching over 100 job centres, and will continue to expand its availability and uptake in the year ahead.

In the upcoming parliamentary year, we will continue simplifying the benefits system, and also work to embed clarity and sustainability in other areas of social security. We continue to improve confidence and transparency in the maintenance arrangements for children of separated parents, by closing legacy schemes and encouraging and incentivising parental collaboration. We will pursue our commitment to help people with disabilities get into, and stay in, work, building on the 300,000 who have joined the workforce in the last year. We have already announced plans to raise the state pension age to 68 in 2037, in a move that will rebalance generational fairness and enhance provision for people in old age. The continued uptake of the workplace pension supports this drive for strategic planning and long-term sustainability.

Optimising and incentivising our work and pensions provision is vital because we need a clear and sustainable system in a post-Brexit world – one that galvanises the workforce and enriches the economy, while supporting the most vulnerable. By getting protections, benefits and incentives right at home, we can build our productivity, presenting a Britain that is ready to do business, and open to engagement with the rest of the world.

The work of my department is more important than ever

“ “Th e Rt Hon David Gauke MPSecretary of State for Work and Pensions

4 | ANDREW NEIL

Andrew Neil

Return of the Two Party SystemThe BBC’s Andrew Neil gives his take on the state of Parliament following the June 2017 general election.

It was a year in which politicians learned not only of the power of a referendum to overrule the will of Parliament – but of its power to change the party system in which they operate. Nobody saw this coming. But, in retrospect, perhaps we should have, since we had the fallout from the Scottish referendum to guide us.

In the autumn of 2014 the Scots voted 55%-45% to remain part of the United Kingdom. That was supposed to settle the matter of Scottish independence for a generation, until some Scottish Nationalists began regarding a generation as no more than a couple of years. But in post-referendum elections to Holyrood and Westminster, it also recast the Scottish party system.

Remember, Scotland had been one of the first parts of the UK to throw off the British two-party system and replace it with a multi-party choice of SNP, Labour, Tory, Green, Lib Dem and even UKIP. But as the constitutional issue took centre-stage – and remained there even after the referendum – Scottish voters coalesced round a binary choice: for or against independence.

Thus was a new two-party system born of a centre-left Nationalist party (the SNP) and a centre-right Unionist party (the Scottish Tories). The other parties have not been completely obliterated, especially in Holyrood with its peculiar voting system. But by the general election of 2017 Scotland had become a battle between a dominant

Neil believes two referendums have redrawn the map of British politics.

Nationalist party and a resurgent Tory party representing the Union. Two-party politics was back north of the border.

So we should have been prepared for something similar when Britain voted 52% to 48% to leave the European Union in the June 2016 referendum. At the time, we remarked on the power of referenda to overrule both the Commons (where MPs were 65% pro-EU) and the Lords (probably 80% pro-EU). What we did not see was how the Brexit referendum would reconfigure English politics just as the Scottish referendum had redrawn Scottish politics.

So we were taken by surprise for a second time. In this year’s general election – perhaps the single biggest act of self-harm a sitting government has ever inflicted on itself – almost 85% in England voted either Conservative or Labour. The English had not voted in such numbers for both major parties since 1970, when the post-war two-party system began to wane – and declined in subsequent elections to a point where barely 65% voted Tory or Labour, encouraging some commentators to think the decline terminal.

The referendum, however, reversed the decline. The Brexit vote ended the schism on the Eurosceptic Right as UKIP voters returned to the Tory fold; and those on the Left of the Greens and the Lib Dems flocked to Jeremy Corbyn’s more ‘Red Flag’ Labour offering. So, as in Scotland previously, two-party politics was back with a vengeance in England too.

But without one crucial element. Our historic two-party system regularly produced one-party government for the life of a Parliament. But our new two-party system has produced a hung Parliament with no party having an overall majority. This knife-edge parliamentary arithmetic means the smaller parties may be down – but they are not out.

The Conservatives need an alliance with one small party (Ulster’s DUP) to be sure of a majority. Even then, with the Tories and Labour divided over Brexit, no majority on any issue will be certain and on many votes the smaller parties will be pivotal in determining many outcomes.

So politicians return from their summer recess to a great parliamentary paradox: the two-party system has resurrected itself but rather than bringing with it the stability and certainty of the two-party politics of old, almost every major vote in the months ahead will be uncertain and unpredictable – and politics will be peculiarly unstable. Power will rest in Parliament. Government will be able to take nothing for granted. No vote will be in the bag until all the votes are counted. Westminster will have a new lease of life – perhaps even a spring in its step. Our democracy might be all the better for it.

George Osborne, though no longer in government, had a profound impact on the pensions landscape during his time as Chancellor

The background to today’s pensions regime

The landscape for pensions has changed almost beyond recognition over the last three and a half years. The change began with the former Chancellor George Osborne’s bombshell Budget speech on 19 March 2014, when he announced the ‘unthinkable’ and did away, at a stroke, with compulsory annuities.

It is worth recalling Osborne’s ground-breaking statement ‘Let me be clear: No one will have to buy an annuity … People who have worked hard and saved hard all their lives, and done the right thing, should be trusted with their own finances.’

That statement sounded attractive. Why shouldn’t people ‘who have done the right thing’ be trusted? The problem, of course, is that in a world of prolonged low returns for ‘safe’ investments, building up a pension pot capable of providing a reasonable standard of living in retirement, is extremely difficult and leads directly to some very complicated investment decisions. These complexities largely have to do with risk.

One of the chief attractions of an annuity was that it provided a stable (though often low) monthly income and thus took some of the worry out of retirement. However, a prolonged period of low returns on ‘safe’ investments like Government bonds in the years following the 2008 global financial crash led to a constant shrinkage in the rate used to calculate the value of an annuity, to the point where alternative investment routes began to look very attractive.

The problem with not going down the annuity route, however, is that it exposes the individual’s pension pot to ongoing market risk. It also arguably encourages individuals to accept higher rates of risk as they get tempted to chase potentially higher returns by pursuing riskier investments. Quite how this will play out over the coming decades remains to be seen, but one probable outcome would see future governments facing the problem of dealing with large numbers of pensioners living in dire poverty – either because they drew down their pension too rapidly, or because risky investment decisions drained the pot.

Review of the Year

5REVIEW OF THE YEAR |

WORK & PENSIONS

4 | ANDREW NEIL

Andrew Neil

Return of the Two Party SystemThe BBC’s Andrew Neil gives his take on the state of Parliament following the June 2017 general election.

It was a year in which politicians learned not only of the power of a referendum to overrule the will of Parliament – but of its power to change the party system in which they operate. Nobody saw this coming. But, in retrospect, perhaps we should have, since we had the fallout from the Scottish referendum to guide us.

In the autumn of 2014 the Scots voted 55%-45% to remain part of the United Kingdom. That was supposed to settle the matter of Scottish independence for a generation, until some Scottish Nationalists began regarding a generation as no more than a couple of years. But in post-referendum elections to Holyrood and Westminster, it also recast the Scottish party system.

Remember, Scotland had been one of the first parts of the UK to throw off the British two-party system and replace it with a multi-party choice of SNP, Labour, Tory, Green, Lib Dem and even UKIP. But as the constitutional issue took centre-stage – and remained there even after the referendum – Scottish voters coalesced round a binary choice: for or against independence.

Thus was a new two-party system born of a centre-left Nationalist party (the SNP) and a centre-right Unionist party (the Scottish Tories). The other parties have not been completely obliterated, especially in Holyrood with its peculiar voting system. But by the general election of 2017 Scotland had become a battle between a dominant

Neil believes two referendums have redrawn the map of British politics.

Nationalist party and a resurgent Tory party representing the Union. Two-party politics was back north of the border.

So we should have been prepared for something similar when Britain voted 52% to 48% to leave the European Union in the June 2016 referendum. At the time, we remarked on the power of referenda to overrule both the Commons (where MPs were 65% pro-EU) and the Lords (probably 80% pro-EU). What we did not see was how the Brexit referendum would reconfigure English politics just as the Scottish referendum had redrawn Scottish politics.

So we were taken by surprise for a second time. In this year’s general election – perhaps the single biggest act of self-harm a sitting government has ever inflicted on itself – almost 85% in England voted either Conservative or Labour. The English had not voted in such numbers for both major parties since 1970, when the post-war two-party system began to wane – and declined in subsequent elections to a point where barely 65% voted Tory or Labour, encouraging some commentators to think the decline terminal.

The referendum, however, reversed the decline. The Brexit vote ended the schism on the Eurosceptic Right as UKIP voters returned to the Tory fold; and those on the Left of the Greens and the Lib Dems flocked to Jeremy Corbyn’s more ‘Red Flag’ Labour offering. So, as in Scotland previously, two-party politics was back with a vengeance in England too.

But without one crucial element. Our historic two-party system regularly produced one-party government for the life of a Parliament. But our new two-party system has produced a hung Parliament with no party having an overall majority. This knife-edge parliamentary arithmetic means the smaller parties may be down – but they are not out.

The Conservatives need an alliance with one small party (Ulster’s DUP) to be sure of a majority. Even then, with the Tories and Labour divided over Brexit, no majority on any issue will be certain and on many votes the smaller parties will be pivotal in determining many outcomes.

So politicians return from their summer recess to a great parliamentary paradox: the two-party system has resurrected itself but rather than bringing with it the stability and certainty of the two-party politics of old, almost every major vote in the months ahead will be uncertain and unpredictable – and politics will be peculiarly unstable. Power will rest in Parliament. Government will be able to take nothing for granted. No vote will be in the bag until all the votes are counted. Westminster will have a new lease of life – perhaps even a spring in its step. Our democracy might be all the better for it.

George Osborne, though no longer in government, had a profound impact on the pensions landscape during his time as Chancellor

The background to today’s pensions regime

The landscape for pensions has changed almost beyond recognition over the last three and a half years. The change began with the former Chancellor George Osborne’s bombshell Budget speech on 19 March 2014, when he announced the ‘unthinkable’ and did away, at a stroke, with compulsory annuities.

It is worth recalling Osborne’s ground-breaking statement ‘Let me be clear: No one will have to buy an annuity … People who have worked hard and saved hard all their lives, and done the right thing, should be trusted with their own finances.’

That statement sounded attractive. Why shouldn’t people ‘who have done the right thing’ be trusted? The problem, of course, is that in a world of prolonged low returns for ‘safe’ investments, building up a pension pot capable of providing a reasonable standard of living in retirement, is extremely difficult and leads directly to some very complicated investment decisions. These complexities largely have to do with risk.

One of the chief attractions of an annuity was that it provided a stable (though often low) monthly income and thus took some of the worry out of retirement. However, a prolonged period of low returns on ‘safe’ investments like Government bonds in the years following the 2008 global financial crash led to a constant shrinkage in the rate used to calculate the value of an annuity, to the point where alternative investment routes began to look very attractive.

The problem with not going down the annuity route, however, is that it exposes the individual’s pension pot to ongoing market risk. It also arguably encourages individuals to accept higher rates of risk as they get tempted to chase potentially higher returns by pursuing riskier investments. Quite how this will play out over the coming decades remains to be seen, but one probable outcome would see future governments facing the problem of dealing with large numbers of pensioners living in dire poverty – either because they drew down their pension too rapidly, or because risky investment decisions drained the pot.

Review of the Year

THE PARLIAMENTARY REVIEW

Review of the Year

6 | REVIEW OF THE YEAR

The Government has tried to mitigate

the risk to individuals by announcing

that everyone would have the right

to access financial advice regarding

their pension.

At the time of the announcement the

thinking was that this advice would

be provided either by independent

financial advisors (IFAs) for a fee, or

for free by the Government’s Money

Advice Service (MAS). The latter was

set up in 2011 and funded by a levy

on the financial services sector. Its

budget of £80 million a year was

supposed to promote greater financial

understanding among the public at

large on savings, investment and

retirement options.

One of the stumbling blocks to

getting the industry to step up to

provide advice to the less well-off on

a pro-bono basis, was the fact that

consumers would still need a right of

redress if the advice turned out to be

actionably wrong. No one wants to

be sued for doing someone a good

turn. This seemed a fairly intractable

problem. The Financial Advice Market

Review (FAMR) report, issued in

March 2016, looked at the regulatory

or other barriers firms faced in giving

advice, and at how to give firms

the regulatory clarity they would

require to provide ‘free’ or ultra low-

cost advice.

In the end, the Government decided

to go with the idea of a Pensions

Advice Allowance (PAA) which

would make it easier for people to

pay for advice. The idea also had the

advantage of making best use of the

existing IFA infrastructure in the UK,

without the Government having to

try to coax firms who provide wealth

management and investment advice

for a living, to offer some lesser level

of service for free.

Accordingly, on 6 April 2017 the

tax rules were amended to allow

individuals with defined contribution

or hybrid benefits to use their pension

pots to pay for financial advice without

incurring adverse tax consequences as

a result of an early withdrawal on their

pension pot. They can now access up

to £500 on three separate occasions

through their lifetime in order to

pay for advice. The idea is that this

gives individuals the option of taking

financial advice at various key stages of

their lives.

The allowance can be used at any age,

but only once in any one tax year.

Financial advice, for the purposes of the

Pension Advice Allowance is defined

as ‘advice in respect of a person’s

financial position, including his pension

arrangements and the use of his

pension funds’.

Pensions and the problem of financial advice to low income savers

The Treasury’s implemention of the PAA should allow low income earners improved access to financial advice when it comes to pensions

Tracy McDermott co-chaired the FAMR report

Osborne’s reforms also tackled the issue

of small, relatively low value ‘stranded’

pension pots. From as far back as 2009

trivial pensions that an individual might

have accumulated during their careers

could be turned to cash instantly

provided certain round rules are met.

Osborne’s 2014 Budget extended

the amount that could be claimed in

any one ‘commutation’ exercise from

£2,000 to £10,000. The regime was

further clarified and tweaked and new

rules came into effect in August 2016.

Provided an individual was over 55

and the total value of all their pensions

was under £30,000 they could take a

trivial pension as a lump sum. However,

only the first 25% is tax free, the rest

is taxed at the appropriate marginal

rate. As with all HMRC-related

matters, there are various rules and

tests surrounding cashing in ‘trivial’

pensions, with slightly different rules

applying to defined benefit (DB) and

defined contribution (DC) schemes.

The State Pension age has been going

up since April 2010. On 6 April 2016

the Government’s new ‘innovation’,

the Single Tier State Pension, came into

force for anyone who reached pension

age on or after that date.

Those who reached pension age before

6 April 2016 will continue to receive

the State Pension under the old rules.

However, one of the big controversies

in pensions through 2016 has been the

reaction of many women to the way

the Government has handled increases

in the State Pension age for women.

The Government has said that it

intends to bring the retirement age for

women into line with the retirement

age for men. To this end, the State

Pension age for women began

increasing in 2010 and will reach 65

by 2018. At present, the Government’s

stated target retirement age for both

men and women is 68, though future

governments may well increase this

still further in the light of evidence that

people are living longer. It has been

pointed out many times that. when

pensions were introduced. the average

The dash for cash

Changes to the State Pension

New rules in 2016 helped to clarify the procedure and requirements for withdrawaing trivial pensions as lump sums

The steady increase in the pension age reflects our increasingly long-lived population


WORK & PENSIONS

Osborne’s reforms also tackled the issue

of small, relatively low value ‘stranded’

pension pots. From as far back as 2009

trivial pensions that an individual might

have accumulated during their careers

could be turned to cash instantly

provided certain round rules are met.

Osborne’s 2014 Budget extended

the amount that could be claimed in

any one ‘commutation’ exercise from

£2,000 to £10,000. The regime was

further clarified and tweaked and new

rules came into effect in August 2016.

Provided an individual was over 55

and the total value of all their pensions

was under £30,000 they could take a

trivial pension as a lump sum. However,

only the first 25% is tax free, the rest

is taxed at the appropriate marginal

rate. As with all HMRC-related

matters, there are various rules and

tests surrounding cashing in ‘trivial’

pensions, with slightly different rules

applying to defined benefit (DB) and

defined contribution (DC) schemes.

The State Pension age has been going

up since April 2010. On 6 April 2016

the Government’s new ‘innovation’,

the Single Tier State Pension, came into

force for anyone who reached pension

age on or after that date.

Those who reached pension age before

6 April 2016 will continue to receive

the State Pension under the old rules.

However, one of the big controversies

in pensions through 2016 has been the

reaction of many women to the way

the Government has handled increases

in the State Pension age for women.

The Government has said that it

intends to bring the retirement age for

women into line with the retirement

age for men. To this end, the State

Pension age for women began

increasing in 2010 and will reach 65

by 2018. At present, the Government’s

stated target retirement age for both

men and women is 68, though future

governments may well increase this

still further in the light of evidence that

people are living longer. It has been

pointed out many times that. when

pensions were introduced. the average

The dash for cash

Changes to the State Pension

New rules in 2016 helped to clarify the procedure and requirements for withdrawaing trivial pensions as lump sums

The steady increase in the pension age reflects our increasingly long-lived population


Review of the Year


On 6 April 2016, a new tapering restriction on tax relief on pension contributions by individuals came into force. This, in combination with the reduction of the lifetime allowance cap from £1.25 million to £1 million, and limits on the size of a member’s annual contribution, has the effect of making pensions an unattractive option for those on £200,000 or more.

From that date individuals with taxable income over £150,000 face losing £1 of their annual allowance for every £2 of income they have over £150,000. This means that when they reach £200,000 in taxable income their allowance has gone. ‘Taxable income’ here means savings and investment income as well as salary income.

Quite how excluding the UK’s higher earners, which probably includes a high proportion of company board members, from the pensions system will affect business leaders’ view of pensions over the medium to long term

remains to be seen. Some pensions

experts have pointed out that, with

executive attention moving away from

pensions to other forms of reward or

investment, we could see a diminution

over time in the value that boards place

on pensions. However, given the auto-

enrolment provisions now in place,

it seems more likely that pensions

will continue to have a place in the

reward structure.

The impact of restricting higher rate relief on pension contributions

survival period for pensioners post-

retirement was four to five years. Today

people retiring at 65 can reasonably

expect to spend 20 years or more

in retirement.

The ‘longevity issue’ – or ‘mortality

creep’, as it is sometimes known –

poses near impossible burdens on

government finances not just in the

UK but across the developed world; in

many countries pension benefits are

paid out of current tax receipts and not

out of a specific accumulated pensions

pool. Accordingly, many governments,

including here in the UK, are

increasingly trying to shift the burden

for maintaining an ageing population

away from the State and back onto

private citizens. This, too, is a major

long-term factor shaping the pensions

sector, and goes some way to explaining

why a previous UK Government

introduced auto-enrolment.

In July 2017, Work and Pensions

Secretary, David Gauke, introduced

yet another hike in the pensions age,

announcing that people born between

1970 and 1978 will not be able to

draw their pensions at age 67, but will

now have to wait until they are 68. The

media were quick to point out that this

will mean a loss of £10,000 each for

more than seven million people who,

today, are in their 30s and 40s.

Pensions being unattractive to high earners may have mid to long term effects on how company pensions are handled

In October 2012, following a report from the Pensions Commission, the Government switched the rules on staff enrolment in pension schemes. Instead of having to opt in to a workplace pension scheme, auto-enrolment was introduced, which meant that qualifying staff were automatically enrolled in the scheme and had to choose to opt out if they did not want to be subject to employee contributions.

The Government decided at the time to introduce the scheme in six stages, starting with the very largest firms and moving on down in stages to the smallest companies, with all companies being enrolled by 2018. Employers are urged to start planning for auto-enrolment twelve months in advance. There are swingeing fines available to the Pensions Regulator to force compliance from employers to all the auto-enrolment rules.

Some of these rules, such as the obligation to re-offer scheme membership every three years to employees who opt out, impose quite severe administrative burdens on employers. There are also strict rules limiting the time employers have to make payments into the scheme – again, with fines for non-compliance.

From the outset, the rules for auto-

enrolment required both employer

and employee to make regular

contributions. Until 5 April 2018

the minimum contribution from the

employer and employees is 1%,

making a total minimum contribution

of 2%. That will increase on 6 April

2018 to a minimum of 2% from the

employer and 3% from the employee,

for a total minimum of 5%. On 6

April 2019, this increases again to 3%

from the employer and 5% from the

employee, making a total minimum

of 8%. The Government’s aim in

introducing auto-enrolment was to

ensure that at least part of the burden

of maintaining people in their old

age was shifted from the state to the

private sector and the individual.

In November 2016, the Pensions Policy

Institute (PPI) published a report entitled

‘The new pensions landscape’. The

basic background to pensions in the

UK had been outlined by the PPI in a

report back in 2004. It found that a

quarter of pensioners were in relative

poverty, that pension savings behaviour

seemed unlikely to deliver more private

pension income in future, and that both

the state and employers were looking

to reduce their support for pensions.

In short, if something was not done to

mandate long-term savings, the future

looked bleak for a large percentage of

the UK’s ageing population.

With auto-enrolment working up to

an 8% contribution rate by 2019 there

is every chance that a considerable

proportion of UK pensioners will be

somewhat ahead of the breadline, at

least, in their retirement years.

In its 2016 statement on auto-

enrolment, the PPI pointed out that if

the opt-out rate stayed at around 9%,

it would mean some 8.5 million more

Auto-enrolment

Chris Curry, Director of the PPI, has commented on the difficulties pension pose for the ageing population of the UK


WORK & PENSIONS

In October 2012, following a report from the Pensions Commission, the Government switched the rules on staff enrolment in pension schemes. Instead of having to opt in to a workplace pension scheme, auto-enrolment was introduced, which meant that qualifying staff were automatically enrolled in the scheme and had to choose to opt out if they did not want to be subject to employee contributions.

The Government decided at the time to introduce the scheme in six stages, starting with the very largest firms and moving on down in stages to the smallest companies, with all companies being enrolled by 2018. Employers are urged to start planning for auto-enrolment twelve months in advance. There are swingeing fines available to the Pensions Regulator to force compliance from employers to all the auto-enrolment rules.

Some of these rules, such as the obligation to re-offer scheme membership every three years to employees who opt out, impose quite severe administrative burdens on employers. There are also strict rules limiting the time employers have to make payments into the scheme – again, with fines for non-compliance.

From the outset, the rules for auto-

enrolment required both employer

and employee to make regular

contributions. Until 5 April 2018

the minimum contribution from the

employer and employees is 1%,

making a total minimum contribution

of 2%. That will increase on 6 April

2018 to a minimum of 2% from the

employer and 3% from the employee,

for a total minimum of 5%. On 6

April 2019, this increases again to 3%

from the employer and 5% from the

employee, making a total minimum

of 8%. The Government’s aim in

introducing auto-enrolment was to

ensure that at least part of the burden

of maintaining people in their old

age was shifted from the state to the

private sector and the individual.

In November 2016, the Pensions Policy

Institute (PPI) published a report entitled

‘The new pensions landscape’. The

basic background to pensions in the

UK had been outlined by the PPI in a

report back in 2004. It found that a

quarter of pensioners were in relative

poverty, that pension savings behaviour

seemed unlikely to deliver more private

pension income in future, and that both

the state and employers were looking

to reduce their support for pensions.

In short, if something was not done to

mandate long-term savings, the future

looked bleak for a large percentage of

the UK’s ageing population.

With auto-enrolment working up to

an 8% contribution rate by 2019 there

is every chance that a considerable

proportion of UK pensioners will be

somewhat ahead of the breadline, at

least, in their retirement years.

In its 2016 statement on auto-

enrolment, the PPI pointed out that if

the opt-out rate stayed at around 9%,

it would mean some 8.5 million more

Auto-enrolment

Chris Curry, Director of the PPI, has commented on the difficulties pension pose for the ageing population of the UK


Review of the Year


In its November 2016 report, the

Pensions Policy Institute (PPI) estimated

that between 2016 and 2046 the

proportion of gross domestic product

(GDP) spent on state pensions could

increase from 5.3% at present, to

7.2%. The Government’s triple lock on

pensions, introduced by the Coalition

Government in 2011, increases the

percentage, since it promises that

the Basic State Pension will rise by a

minimum of either 2.5%, or the rate of

inflation, or average earnings growth

– whichever is the larger. However,

the increases in the State Pension Age,

work in the opposite direction.

According to the Institute for Fiscal

Studies, between April 2010 and April

2016 the value of the State Pension

increased by 22%. By comparison

earnings grew over that period by

just 7.5% and prices by 12.3%. So

pensioners saw their pensions rise at

almost double the pace of the average

worker. Compared with an uprating

in line with increases in earnings, the

increased benefit to pensioners cost

an extra £6 billion a year in 2015–16.

It cost about £4 billion relative to

indexation to the consumer prices

index (CPI).

The Conservatives had said that they

would scrap the triple lock in 2020 and

spend the money saved on additional

healthcare. However, since the

Government failed to win an outright

majority in the last election, and with

both Labour and the DUP committed

to keeping the triple lock, that scheme

looks, at best, unlikely.

The Lifetime ISA, or LISA, was

announced in 2016 and came into effect

in April 2017. It is available for anyone

aged 18 to 39. The big attraction is

that for anyone investing the maximum

of £4,000 a year, the Government will

put in an additional £1,000.

The money can be used to buy a new

home (as early as 12 months after

starting the LISA) or withdrawn tax

free at age 60. The aim, clearly, is to

stimulate long-term savings among the

under 40s, the age bracket in which

long-term savings are weakest. As with

other ISAs individuals can invest in cash

or the stock market, with cash being

the best choice for anyone planning to

withdraw the money within five years.

The triple lock

The Lifetime ISA

people would be saving in a defined

contribution (DC) pension scheme by

2030.In all, the PPI expected auto-

enrolment to push the value of assets

in private sector DC pension schemes

up by potentially £145 billion by 2030.

The Triple Lock pension was introduced by the Coalition government in 2011

In September 2016, the Pensions

Regulator noted, in a blog, that the idea

that all defined benefit (DB) schemes

were in crisis, and that the only

solution to prevent sponsor insolvency

was to slash member benefits, didn’t

bear scrutiny. ‘The data does not bear

out the argument that in general DB

schemes are unaffordable – nor that

they are about to fail, or bankrupt their

sponsors, or overwhelm the pension

“life raft”, the Pension Protection Fund

(PPF),’ the Regulator commented.

The cost of funding liabilities in DB

schemes is greater now than schemes

had assumed in days gone by.

Persistent low returns on investments,

longevity and the failure of some

higher risk investment strategies all

take a share of the blame for this.

As of June 2017, the total DB deficit

estimated by the Regulator stands at

around £350 billion to £400 billion.

Accountants PricewaterhouseCoopers

(PwC) put it higher. They estimate that

the combined deficit of the UK’s 5,800

DB pension schemes stood at around

£510 billion in May 2017.

Looking at FTSE 350 companies, the

Regulator points out that most of these

are well positioned to continue with their

deficit recovery contributions (DRCs)

in the year ahead. Struggling sponsor

companies have total deficits of about

£35–40 billion and some of these might

end up in the PPF, though this does not

represent a crisis, the Regulator argues.

By June 2017, however, there were clear

signs that the Regulator was starting to

get irritated by the way in which FTSE

350 firms were prioritising dividend

payouts to shareholders over their

responsibility to pay down their pensions

deficits. A report from the Regulator in

June 2017 shows that the percentage of

FTSE 350 companies with a DB scheme

that paid no DRCs, but paid dividends,

rose from 11% back in 2011, to 15%

by the end of 2016.

This represents a ‘disappointing’

increase according to Andrew Warwick-

Thompson, the Regulator’s Executive

Director for Regulatory Policy. He

warned that the Regulator was ‘likely

to intervene’ if it found that companies

were persistently neglecting their

DRC responsibilities in favour of

paying dividends.

On 14 November 2016, Legal &

General Group (L&G) announced

the year’s biggest defined benefit

(DB) buyout – a £1.1 billion deal for

the Vickers Group Pension Scheme.

L&G manages some £12 billion

of assets for pension schemes for

Vickers’ parent, Rolls-Royce. ‘This is

a fantastic result in a period that has

seen challenging news for pensions

Company DB schemes

DB scheme buyouts in 2016/17

The Pensions Regulator has cast doubt that the ‘life raft’ of the PPF is set to deflate


WORK & PENSIONS

In September 2016, the Pensions

Regulator noted, in a blog, that the idea

that all defined benefit (DB) schemes

were in crisis, and that the only

solution to prevent sponsor insolvency

was to slash member benefits, didn’t

bear scrutiny. ‘The data does not bear

out the argument that in general DB

schemes are unaffordable – nor that

they are about to fail, or bankrupt their

sponsors, or overwhelm the pension

“life raft”, the Pension Protection Fund

(PPF),’ the Regulator commented.

The cost of funding liabilities in DB

schemes is greater now than schemes

had assumed in days gone by.

Persistent low returns on investments,

longevity and the failure of some

higher risk investment strategies all

take a share of the blame for this.

As of June 2017, the total DB deficit

estimated by the Regulator stands at

around £350 billion to £400 billion.

Accountants PricewaterhouseCoopers

(PwC) put it higher. They estimate that

the combined deficit of the UK’s 5,800

DB pension schemes stood at around

£510 billion in May 2017.

Looking at FTSE 350 companies, the

Regulator points out that most of these

are well positioned to continue with their

deficit recovery contributions (DRCs)

in the year ahead. Struggling sponsor

companies have total deficits of about

£35–40 billion and some of these might

end up in the PPF, though this does not

represent a crisis, the Regulator argues.

By June 2017, however, there were clear

signs that the Regulator was starting to

get irritated by the way in which FTSE

350 firms were prioritising dividend

payouts to shareholders over their

responsibility to pay down their pensions

deficits. A report from the Regulator in

June 2017 shows that the percentage of

FTSE 350 companies with a DB scheme

that paid no DRCs, but paid dividends,

rose from 11% back in 2011, to 15%

by the end of 2016.

This represents a ‘disappointing’

increase according to Andrew Warwick-

Thompson, the Regulator’s Executive

Director for Regulatory Policy. He

warned that the Regulator was ‘likely

to intervene’ if it found that companies

were persistently neglecting their

DRC responsibilities in favour of

paying dividends.

On 14 November 2016, Legal &

General Group (L&G) announced

the year’s biggest defined benefit

(DB) buyout – a £1.1 billion deal for

the Vickers Group Pension Scheme.

L&G manages some £12 billion

of assets for pension schemes for

Vickers’ parent, Rolls-Royce. ‘This is

a fantastic result in a period that has

seen challenging news for pensions

Company DB schemes

DB scheme buyouts in 2016/17

The Pensions Regulator has cast doubt that the ‘life raft’ of the PPF is set to deflate


Review of the Year


One of the biggest changes for many

employers through 2016 was the

introduction of the National Living

Wage (NLW). The Resolution Foundation

surveyed 500 businesses to produce the

first substantial report on its impact.

The ‘take-away’ from the Foundation’s

survey is that the majority of employers

are reacting to the inevitable additional

cost burden imposed by the NLW, by

passing costs on to the consumer through

higher prices, or taking lower profits,

rather than by cutting staff numbers.

However, the Resolution Foundation’s

policy analyst, Conor D’Arcy, pointed

out that, on the positive side, the

NLW was delivering a meaningful pay

increase to millions of employees. The

best long-term solution for companies

to the impact the NLW was having on

their wage costs was to find ways of

increasing productivity, he said.

The Government’s gender pay gap reporting rules came into effect on 6 April 2017 for all companies with 250 or more staff. The gender pay gap reflects the difference between the average earnings of men and women and is expressed as a percentage of the average male earnings in an organisation.

The basic idea behind the introduction of this reporting requirement is that one of the first and most fundamental changes needed to equalise pay between the sexes is transparency regarding gender pay differences.

Employment law changes through 2016 and 2017

The gender pay gap

and members in general,’ L&G said. It gives trustees price certainty and is the culmination of years of effort by the trustees to de-risk the scheme.

Kerrigan Procter, Managing Director of Legal & General Retirement, commented that L&G’s long-standing relationship with the trustees was a very positive factor in bringing the buyout to a successful conclusion.

Tracy Blackwell, Chief Executive Officer of the buyout specialist, Pension Insurance Corporation, recently indicated that demand for buyouts had been so

buoyant through 2016 that the firm was

considering tapping the stock markets

to help fund its expansion. It raised £250

million from Chinese investors a year ago

and currently runs around £18 billion

worth of retirement funds.

In December 2016 Blackwell commented

‘We’ve been really surprised, especially

after Brexit and low interest rates and

everything else – we thought there

would be a huge slowdown in demand

for buyouts. But it has been anything

but. Demand has been extraordinary and

we see it continuing well into 2017.’

The gender pay gap is something an increasing amount of developed countries are attempting to address

Calls for the introdution of a National Living Wage had gone on for years, prior to its introduction in 2016

The EU’s General Data Protection Regulation (GDPR) comes into effect on 25 May 2018 and the UK Government has already warned business that the implementation of the GDPR will go ahead despite Brexit. Though the GDPR has quite a lot in common with the UK’s Data Protection Act, it also differs from it significantly. Further, it introduces hefty fines for employers that breach the GDPR or fail to comply, so it is something that businesses caught up by the GDPR need to address very thoroughly.

The UK Information Commissioner’s Office (ICO), the body set up to uphold information rights, has published its own comprehensive 12-step guide to the GDPR. As the Information Commissioner, Elizabeth Denham, noted in a speech on 4 July this year, companies need to keep in mind that the end game in data protection is about increasing public trust and confidence in how their personal data is used.

With that as the overarching principle, companies need to grasp the fact that the ICO is taking the GDPR very seriously. The digital infrastructure of today is way beyond anything that was conceived when the UK’s DPA was forged two decades ago and it needs a much more focused response from companies, Denham warned.

In the ICO’s Annual Report for 2016/17, Denham, who took up the post in July 2016, pointed out that the digital economy is vital to the UK. ‘Personal data and how it is handled is central to trade and growth, and studies show that the digital economy is growing 30% faster than the rest of the economy. Data knows no borders,’ she commented.

Preparing for the EU’s General Data Protection Regulation (GDPR)

Greater transparency improves the

likelihood that the problem will be

recognised and dealt with positively by

senior management.

It is important to realise that the

gender pay gap is not identical with

equal pay. It is already illegal to pay less

to a woman than a man where both

are doing the same job. A high gender

pay gap can arise because a company

has far more women in part time – and

therefore lower paid – roles. It might

indicate that there is a disproportionate

number of women employed in low-

skilled jobs by comparison with male

employees. Recognising this could

highlight a cultural preference for men

in certain roles which will need to be

addressed. A high gender pay gap also

tends to show up in industries that are

traditionally male dominated, such as

construction and engineering.

Employers need to note that the gender

pay gap reporting requirement uses

the expanded definition of employee,

again, with effect from April 2017.

This expanded definition includes, for

example, some self-employed people

who are personally performing services

and part-time workers.

The GDPR will have a substantial impact on businesses in Europe and the UK


WORK & PENSIONS

The EU’s General Data Protection Regulation (GDPR) comes into effect on 25 May 2018 and the UK Government has already warned business that the implementation of the GDPR will go ahead despite Brexit. Though the GDPR has quite a lot in common with the UK’s Data Protection Act, it also differs from it significantly. Further, it introduces hefty fines for employers that breach the GDPR or fail to comply, so it is something that businesses caught up by the GDPR need to address very thoroughly.

The UK Information Commissioner’s Office (ICO), the body set up to uphold information rights, has published its own comprehensive 12-step guide to the GDPR. As the Information Commissioner, Elizabeth Denham, noted in a speech on 4 July this year, companies need to keep in mind that the end game in data protection is about increasing public trust and confidence in how their personal data is used.

With that as the overarching principle, companies need to grasp the fact that the ICO is taking the GDPR very seriously. The digital infrastructure of today is way beyond anything that was conceived when the UK’s DPA was forged two decades ago and it needs a much more focused response from companies, Denham warned.

In the ICO’s Annual Report for 2016/17, Denham, who took up the post in July 2016, pointed out that the digital economy is vital to the UK. ‘Personal data and how it is handled is central to trade and growth, and studies show that the digital economy is growing 30% faster than the rest of the economy. Data knows no borders,’ she commented.

Preparing for the EU’s General Data Protection Regulation (GDPR)

Greater transparency improves the

likelihood that the problem will be

recognised and dealt with positively by

senior management.

It is important to realise that the

gender pay gap is not identical with

equal pay. It is already illegal to pay less

to a woman than a man where both

are doing the same job. A high gender

pay gap can arise because a company

has far more women in part time – and

therefore lower paid – roles. It might

indicate that there is a disproportionate

number of women employed in low-

skilled jobs by comparison with male

employees. Recognising this could

highlight a cultural preference for men

in certain roles which will need to be

addressed. A high gender pay gap also

tends to show up in industries that are

traditionally male dominated, such as

construction and engineering.

Employers need to note that the gender

pay gap reporting requirement uses

the expanded definition of employee,

again, with effect from April 2017.

This expanded definition includes, for

example, some self-employed people

who are personally performing services

and part-time workers.

The GDPR will have a substantial impact on businesses in Europe and the UK


Review of the Year


All employers with an annual payroll in excess of £3 million became liable to pay a 0.5% apprenticeship levy on their total salary bill from 6 April 2017. All levy paying employers can create an account on the apprenticeship service which will enable them to access levy

funds to spend on apprenticeships. Employers who fall outside the £3 million hurdle cannot access levy funding until sometime in 2018, at which point the Government envisages allowing smaller firms to register for an apprenticeship service account.

As part of its drive to get rid of six-figure

exit payments to civil servants and others

in the public sector, the UK Government

consulted on a series of measures in

2016. These are all designed to cap

public sector exit payments.

In September 2016, the UK

Government announced its response

to the consultation, setting out a new

compensation framework for public

sector workers. The key features of the

framework are that the total cost of

exit payments (excluding pension lump

sum payouts) is capped at £95,000.

This includes ex gratia payments and

special severance payments, as well

as ‘other benefits’ and payments in

lieu of notice. It does not, however,

include payments made in compliance

with an order of court or tribunal or

compensation payments in respect

Apprenticeship levy on large employers

Cap on public sector exit payments

One of the central problems the GDPR

and the DPA has to grapple with in

the modern era, she points out, is that

almost everything that anyone does

these days leaves a digital trail. Couple

this with Big Data, AI and machine

learning, and there is a real need to

ensure that people’s fundamental

privacy rights are not sacrificed in the

name of innovation.

In responding to the GDPR, companies

need to document the personal data

they hold, where it came from and with

whom it is shared. This will probably

include an information audit. They

need to check their procedures to

ensure that they do not conflict with

the rights of individuals, and decide

how they are going to handle subject

access requests in the time frame laid

out by the GDPR.

They need to check on their processes

for seeking, recording and managing

the consent of individuals to the

storage of their personal data and

that they have the right procedures in

place to detect, report and investigate

personal data breaches. And they need

to designate someone as responsible

for data protection compliance; this

may involve formally designating a Data

Protection Officer.

The Scottish Parliament will have to make a decision whether to follow suit in capping public sector pay

Ensuring compliance with the GDPR is essential for businesses, as data protection laws grow more expansive

The 28th October ruling by a London

employment tribunal that Uber drivers

should be entitled to workers’ rights

was undoubtedly one of the most far

reaching employment judgements

of the past year. It affects tens of

thousands of Uber drivers and has major

implications for organisations who

operate in the so-called gig economy.

Brought by the GMB Union on

behalf of two Uber drivers, the case

challenged Uber’s claim that its drivers

were ‘partners’ rather than employees.

The ruling means that drivers are

entitled to receive the national living

wage, holiday pay and sick pay.

However, in April 2017 Uber was given

leave to appeal against the ruling. The

Employment Appeal Tribunal (EAT)

in London has set a two-day hearing

scheduled for 27th September 2017.

Commenting on the case, an Uber

spokesperson said ‘The vast majority

of drivers who use Uber tell us they

want to remain their own boss as

that’s the main reason they signed

up to us in the first place. Licensed

drivers who use our app are totally

free to choose if, when and where

they drive with no shifts, minimum

hours or uniforms.’ Uber claims it is

a technology company, thanks to the

Uber app for smart phones, rather

than a taxi company.

Employment lawyers have pointed

out that, while the Uber case is

important, the London tribunal

based its judgement specifically on

an examination of the Uber business

model. Other companies in the gig

economy tend to have a whole range

of different business models, so there

are limits on how far one judgement

can be expected to influence the gig

economy as a whole. Whichever way it

goes, the September appeal judgement

is certain to be very closely scrutinised

across the sector.

The Uber tribunal judgement goes to appeal

of death or injury attributable to the

employment. Any relaxation of the

cap requires ministerial consent. The

cap applies to anyone on a salary of

£80,000 or over.

Annoyed by a number of instances

where senior public sector figures

have left with high severance

packages, only to rejoin a different

department shortly after on similarly

high pay, the Government is

introducing claw back provisions.

These provisions enable the recovery

of exit payments for those on £80,000

and above if they rejoin or return to

any part of the public sector within

twelve months. The relief is tapered

on a month-by-month basis with zero

claw back at twelve months.

The Scottish Government is consulting

on whether to follow the English

provisions but has said it is doing so

simply ‘to ensure that decisions about

a Scottish approach to future exit

payment policy is informed by as many

voices as possible.’

The implications of the ruling for other organisations who have profited from the flexibility of modern employment systems could be far-reaching


WORK & PENSIONS

The 28th October ruling by a London

employment tribunal that Uber drivers

should be entitled to workers’ rights

was undoubtedly one of the most far

reaching employment judgements

of the past year. It affects tens of

thousands of Uber drivers and has major

implications for organisations who

operate in the so-called gig economy.

Brought by the GMB Union on

behalf of two Uber drivers, the case

challenged Uber’s claim that its drivers

were ‘partners’ rather than employees.

The ruling means that drivers are

entitled to receive the national living

wage, holiday pay and sick pay.

However, in April 2017 Uber was given

leave to appeal against the ruling. The

Employment Appeal Tribunal (EAT)

in London has set a two-day hearing

scheduled for 27th September 2017.

Commenting on the case, an Uber

spokesperson said ‘The vast majority

of drivers who use Uber tell us they

want to remain their own boss as

that’s the main reason they signed

up to us in the first place. Licensed

drivers who use our app are totally

free to choose if, when and where

they drive with no shifts, minimum

hours or uniforms.’ Uber claims it is

a technology company, thanks to the

Uber app for smart phones, rather

than a taxi company.

Employment lawyers have pointed

out that, while the Uber case is

important, the London tribunal

based its judgement specifically on

an examination of the Uber business

model. Other companies in the gig

economy tend to have a whole range

of different business models, so there

are limits on how far one judgement

can be expected to influence the gig

economy as a whole. Whichever way it

goes, the September appeal judgement

is certain to be very closely scrutinised

across the sector.

The Uber tribunal judgement goes to appeal

of death or injury attributable to the

employment. Any relaxation of the

cap requires ministerial consent. The

cap applies to anyone on a salary of

£80,000 or over.

Annoyed by a number of instances

where senior public sector figures

have left with high severance

packages, only to rejoin a different

department shortly after on similarly

high pay, the Government is

introducing claw back provisions.

These provisions enable the recovery

of exit payments for those on £80,000

and above if they rejoin or return to

any part of the public sector within

twelve months. The relief is tapered

on a month-by-month basis with zero

claw back at twelve months.

The Scottish Government is consulting

on whether to follow the English

provisions but has said it is doing so

simply ‘to ensure that decisions about

a Scottish approach to future exit

payment policy is informed by as many

voices as possible.’

The implications of the ruling for other organisations who have profited from the flexibility of modern employment systems could be far-reaching


Review of the Year


The Prime Minister has gone on record as saying that the Government is not interested in making major changes to employment law post Brexit. However, a recent survey by GQ Employment Law found that, while employers generally shared the Prime Minister’s view that no major change is required, the one major exception to this consensus is the simmering annoyance many businesses feel over the European Court of Justice (CoJ) ruling on sick pay and holiday pay.

The Court found that employees who are long-term absentees from work, due to chronic illness or disability, are still entitled to holiday pay. The idea that a sick person who is not working should be able to take a paid break from work flies in the face of common sense for many employers. The whole point of holiday pay is to provide an opportunity for employees to take a

rejuvenating break and return to work refreshed. That someone who is not at work should need a break from work seems nonsensical, and employers generally feel that the CoJ’s judgement is unfair to them. This is one area, at least, that employment lawyers feel could be usefully addressed post Brexit.

A second ‘minor change’ could be over the fact that unlike unfair dismissal claims, which are capped, claims based on discrimination are uncapped. The argument from the employers’ side is that leaving discrimination claims uncapped adds massively to the uncertainty of outcome in such cases. This tends to force employers to take a commercial view on settling claims outside the tribunal which they feel are unjustified, simply because contesting the case would leave them open to an unknown but potentially very significant compensation order.

Employment law issues post Brexit

The impact that leaving the European Court of Justice may have on employment law is difficult to predict

WORK & PENSIONS

17GROVE PENSION SOLUTIONS |

Michael Ormond, CEO and Founder of Grove Pension Solutions Ltd

Grove Pension Solutions is a specialist regulated financial adviser firm that focuses entirely on pensions; in particular early pension release and pension transfers.

This is arguably one of the most intensely FCA regulated and high risk area of financial services. Following the Government’s new ‘pension freedom’ legislation introduced in April 2015, it has seen a considerable surge in demand – with seemingly every one of the millions of deferred members of Defined Benefit (final salary) pension schemes now wanting advice.

Grove PS provides services in three main areas:

» Individual clients with any type of UK based pension looking to retire or access

pension benefits early – known as ‘pension release’.

» Defined Benefit pension transfers for other Independent Financial Advisers (IFA)

client’s.

» Large scale pension transfer ‘de-risking’ projects for companies struggling with

Defined Benefit liabilities.

Pension Release

In the past we have fine-tuned our processes and purposely eschewed the

traditional model for financial advice in a number of key areas;

» Our advisers are not ‘door to door’ – the vast majority of our client advice is by

telephone and we communicate mostly by post and e-mail.

» The majority of our team is made up of administrators and support staff with a

small number of advisers. Our staff specialise in specific roles for which they are

recruited fresh into the industry, normally school or university leavers. We then

carry out detailed and ongoing training throughout their career with us.

» We re-invest significantly in technology and IT systems.

» Our focus is on accuracy and efficiency, which in turn provides quick settlement

of funds to our clients.

This approach is beneficial because it enables us to provide comprehensive advice

to everyone, irrespective of income, rather than focusing on ‘high net worth’

clients. For example in the past 12 months our clients’ pension funds have ranged

from just £10,000 to over £1.8m. In addition, by simply being as efficient as

possible in the ‘back-office’ and focusing on one key area of the client’s personal

finances, our advisers can concentrate on providing the best possible advice

to everyone.

FACTS ABOUT GROVE PENSION SOLUTIONS

» Founded in 2007

» Specialist in all types of pension transfer and pension release

» Clients throughout the entire UK

» Services provided both directly and for introducing professionals

» Over 3000 pension transfers successfully completed

» Current funds under management in excess of £62 million

» We are a client-centric business focusing on positive customer outcomes

» Compliance driven processing

» Over 150 years industry experience from senior management

» Authorised Defined Benefit pension scheme specialist

Grove Pension Solutions


Highlighting best practice

18 | GROVE PENSION SOLUTIONS

Independent Financial Adviser (IFA) Transfer Bureau

Our efficient and process driven approach, combined with our expertise and reputation within the industry, sees us entering a new phase; in the last year, other regulated financial advisers have started to use us to assist them with pension transfers for their own clients. This collaboration effort is dependent on a significant degree of trust in our expertise and professionalism – often these are clients that the adviser has spent many years building a relationship with and we are effectively being ‘recommended’ to them to assist in a highly complex area. The fees generated from these professional connections have rapidly become a substantial part of our income and we intend to expand this further.

This new strand to our business very much reflects a more fundamental shift in financial services. The financial advice sector is under increasing regulatory scrutiny, whilst the requirements on IFA’s in terms of qualifications, expertise and even professional indemnity insurances is making it more and more difficult for many of these ‘sole traders’ to operate.

This type of collaboration – where professional advisers choose a ‘specialism’ but work together for individual clients – is certainly going to be one of the solutions to the challenges facing the personal financial advice industry.

De-risking projects – large scale defined benefit transfers

We were approached in 2016 by a small but profitable company that had been struggling for years with the legacy of a Defined Benefit pension scheme. Although the scheme had long since closed to future accrual, the company had been wrestling with a scheme deficit and in the past 10 years they had contributed an additional £700,000 into this ‘black hole’. Despite this considerable effort, during this period the deficit had actually increased with potentially serious consequences for the longer-term viability of the business.

The management of the company was, however, aware of the new pensions freedom legislation and increase in possible benefits for individual members in taking a transfer option.

We aim to provide comprehensive advice to everyone irrespective of their income

““

Claire Butler, Head of Administration and Support Staff

19GROVE PENSION SOLUTIONS |

WORK & PENSIONS

Following an agreement with the company, we independently approached all non-retired members of the scheme and provided full regulated advice to them individually. We explored the potential risks and advantages of transferring into a personal pension and how these could apply to their own circumstances and long term objectives. At the same time we helped the company offer an increased transfer value for all members, making the transfer option more attractive.

As a result of this successful project, the majority of members have now taken a transfer. In addition, the company has a real prospect of being able to close the scheme with remaining member’s benefits secured in full; enabling it to invest profits back into the business.

There are, of course, still thousands of private sector defined benefit schemes with long term deficits, and in many cases this pension scheme ‘black hole’

is the biggest single business risk to the

parent company.

For many of these employers, a

scheme wind-up – where the whole

scheme liability is passed onto an

insurance company – is prohibitively

expensive. However, by undertaking

an individual member transfer-out

project, this burden can be significantly

reduced. In addition, as long as this

is conducted fully in accordance

with the regulations, each individual

member will be given the best possible

advice and satisfied that they have

decided how best to utilise their

pension entitlement.

Because of the inherent specialist

nature of our business, highly

experienced management structure

and policy of training staff from the

pool of school and university leavers,

we feel very confident that we will

be well positioned to turn future

challenges into opportunities.

Tim Flippance, Director of Client Adviser Services



20 | PRIMETIME RETIREMENT

Kim Lerche-Thomsen, Founder and Chief Executive Officer

Test drive your retirement

Primetime Retirement were the pioneers of the fixed term annuity in the UK. When I set up my company more than a decade ago, I wanted people to have more flexibility in

their retirement options and to enable them to test drive their retirement before jumping into the default option at the time, the lifetime annuity. It seemed to me foolish to spend the whole of a working lifetime saving for retirement only to hand over hard-earned funds into an inflexible arrangement that couldn’t be changed through retirement.

That also presented me with another issue: the word ‘retirement’. One definition

was ‘to withdraw from life’ and another was ‘to give up your regular work because

you are getting old’. None of these were appealing. It seemed to me, (back then),

that retirement was an opportunity to explore new avenues and to work flexibly

using your pension fund to help support this.

I started by looking at the business model of the lifetime annuity market which

could be boiled down to ‘we want you to die’. The industry was evolving towards

individual underwriting to try and size up how poor your health was and whether

an enhanced rate could be offered if you smoked or were overweight or suffered

from an ever-increasing list of life shortening illnesses. Yes, this gave extra income

for a shortened retirement period but it was all rather depressing.

What about a business model based on ‘we want you to live’? This seemed to me

to be a much healthier relationship with clients and we started to build our initial

products with this in mind.

FACTS ABOUT PRIMETIME RETIREMENT

» Founded in 2006 as Living Time (later rebranded to Primetime Retirement)

» UK’s pioneer of Fixed Term Annuities, writing over £600 million of business through more than 10,000 policies

» Responsible for the award-winning Offer More Options industry campaign and founding board member of the Pension Income Choice Association (PICA)

» Winner of multiple awards for product design, service and marketing

Primetime Retirement

21PRIMETIME RETIREMENT |

WORK & PENSIONS

I also wanted to create an innovative

solution that would not only give

retirees freedom, but also make

financial sense. To do this, we

designed all of our products to give a

known outcome by providing details of

the income you would get each year,

over what term, what you would get

if you die during the term, and what

you would get back at the end of the

term. They were designed for people

who wanted certainty and didn’t want

to expose themselves to investment

risk, particularly in the early years

of retirement.

To date, Primetime Retirement has

written more than 10,000 policies

and has invested over £600 million on

behalf of clients. Now, as part of the

Key Retirement Group, we continue

to innovate and provide retirees with

a great range of options. This backing

means that we can strengthen our

business whilst utilising the expertise of

our group partners.

Right from the start though, I wanted

to campaign for more choice for

retirees and to reduce the risk of

people sleepwalking into a lifetime

annuity without considering the

alternatives. We were a founding

member of the Pension Income Choice

Association, a group representing

product providers, independent

financial advisers and employment

benefit consultants in the annuities

and retirement market. A campaign

called Offer More Options was

also instrumental in the push for

flexibility, and later helped shape

Pensions Freedoms, which completely

revolutionised the market.

Over the years, we have seen a raft

of competitors, including some well-

known names, emulate our offering,

which has led to the competitive

retirement market we see today.

We continue to evolve and remain

committed to our desire to offer the

best rates for our products.

However, what truly differentiates us

in the market is the unwavering set

of guiding principles we have had in

place from the start. We believe in

putting customers first and ensuring

that they have the flexibility required

in retirement.

As a boutique company, the

importance of having a human touch

when dealing with customers is central

to our business culture. We understand

the money people place in our hands

is vital to their final retirement income.

As such, we never forget it is their

money not ours.

Despite our success in the market,

there have also been challenges along

the way. Following the economic crisis

in 2008, we saw the near-collapse of

our largest backer in life cover, AIG.

At the same time, we witnessed the

start of what would become a long-

term low interest rate environment.

This has meant that 5-year bonds

which would have received 5–7%

interest in 2006, now earn just a

fraction of that. As a result, the

annuity market has suffered, but with

people’s expectations now in line with

this new reality, we have overcome

these issues.

We believe in putting customers first and ensuring that they have the flexibility required in retirement

“

“Pension freedoms enables retirees to have a greater choice of retirement options than the traditional inflexible lifetime annuity



22 | PRIMETIME RETIREMENT

As I mentioned previously, the big shake up the pensions industry has undergone is Pensions Freedoms. This is immensely satisfying having campaigned tirelessly for change. The new rules finally gave consumers options and, almost more importantly, the awareness they had options. However, this has brought a new set of issues as with flexibility and freedom comes with the responsibility to make the right decision. This choice can sometimes seem overwhelming, and retirees are now at greater risk of selecting a pension solution that is not suitable for their circumstances. This is where seeking financial advice is crucial and why we have always supported advice wherever possible.

More also needs to be done to encourage retirees to put their funds into a mix of assets. Since the Pension Freedoms, many retirees have sometimes unknowingly put all their funds into riskier options

such as drawdown funds or equity

investments, rather than going down

the traditional route of purchasing

a secure lifetime annuity. Some

customers may not be aware of this

extra risk, nor have the capacity for

loss. Whilst clients may accept higher

risk in return for higher levels of

income, it’s important to note that a

negative market event could reduce

their capital to a point where it could

not sustain sufficient income.

To this end, Primetime Retirement

remains strongly committed to

supporting advisers and the crucial role

they play in educating retirees on the

wide range of products available.

At Primetime Retirement, I will

continue to drive innovation in the

market and work with advisers to

ensure that customers make the

right choice for their future and have

happier retirements.

Primetime Retirement remains strongly committed to supporting advisers and the crucial role they play in educating retirees on the wide range of products available

“

“

The concept of retirement and what that means is evolving rapidly

WORK & PENSIONS

23BLUE SKY FINANCIAL PLANNING |

Gary Neild – Owner, Managing Director

AT A GLANCE

» Chartered Financial Planners – Regulated by the Financial Conduct Authority

» Founded 2002 in Bournemouth; now located in Poole by Gary Neild, the Owner and Managing Director

» Focussed on Comprehensive Financial Planning

» Committed to Improving financial education

» Assets under management of £100 million

» Superb staff retention delivering continuity for clients

» Innovative in creating bespoke technology solutions

Blue Sky Financial Planning has made more of an impact in the Financial Planning world than our size suggests. The 14-strong team are all passionate about engaging people

to take more control of their future. We encourage our clients to enjoy their money whilst they have good health. Easy to say but the key, for most, is having a comprehensive financial strategy, which provides security into the future. Blue Sky ensures there is no disconnect between the numbers and a client’s aspirations.

The sector we operate in is often termed ‘wealth management’. This is where advice is given around investments, pensions and estate planning to name but a few. I make a distinction between the wealth management sector and what Blue Sky offers. Financial Planning, delivered properly, is about so much more than just looking after the money. We encourage our clients to dream about the life they would like and place it in context of what is possible. We challenge pre-determined thinking to eliminate biases. Only then do we set about modelling different scenarios to see if we can make dreams come true and explore the possibilities. The results are often life-changing.

Typically, Blue Sky’s clients range from 45 years of age, upwards. Over the last year though, it’s been evident that younger people are beginning to enquire about planning. This is encouraging. Typically, these are high earners who wish to plan for their children’s education fees and/or are seeking ways to make the most of tax allowances because of the restrictions around pension contributions.

The pension freedom rules have meant we are receiving many enquiries, particularly from those approaching ages 55 or just beyond (the age at which pension benefits can be taken). Add into the mix the high transfer values being offered by ‘old’ Occupational Pension schemes and you can imagine why we are very busy. We anticipated this momentum and obtained permissions to advise on Occupational Transfers. We have a dedicated service and every possible transfer must be modelled to explore the likely impact, both positive and negative. We stress test scenarios to understand the risks and viability of moving the money from an environment where the income is fixed and predictable in favour of a more flexible regime. We always start off with the premise that it shouldn’t be moved.

Of course, it’s not just about the initial advice, important as this is. We have a duty of care to ensure a strategy is on track to meet the assumptions made at outset. We therefore continuously evaluate and measure each client’s progress. Our planning tools benchmark the returns required to meet the desired outcomes.

The ‘engine’ driving many of the planning scenarios is the Blue Sky investment proposition. This consists of a range of options befitting a company which is independent. Our active models are bespoke. Not our only offering, but one of which we are very proud. Our investment style has changed recently in response to the uncertain geo-political landscape. I now sit on the Asset Allocation Committee

Blue Sky Financial Planning

At its heart, Financial Planning empowers people to make more purposeful decisions, with confidence

“

“



24 | BLUE SKY FINANCIAL PLANNING

of a major investment house in the City of London. An approach which isn’t widely available and an opportunity to create bespoke model portfolios for our clients whilst also benefitting from additional research capability.

It is a privilege to look after our clients’ money and therefore it’s only right we communicate frequently about what’s going on in the world and how we are responding within our active portfolios. We provide in-house weekly snapshots, monthly updates and quarterly overviews, including the thoughts of our preferred investment partners.

Technology has always been at the heart of our service proposition and we believe strongly in reinvesting to enhance the value we deliver to clients. Recently, we embarked upon a new client management system, which means clients can now access all their financial information in one place through their own password protected portal.

Building confidence takes time. We believe It’s important to build layers of trust to empower clients through financial education. It would be easier to sell someone a product but the UK is littered with people who have been sold products and, as a result, many have an eclectic mix of policies to which they have no emotional connection.

Blue Sky’s emphasis is focused on working with our clients over the long term to ensure any changes, personal or otherwise, are integrated into a client’s preferred strategy.

By far the highest number of enquiries

are from those wishing to explore their

retirement options. In particular, we

work well with employees of multi-

national companies – educated people

who understand the need to plan and

are willing to pay for advice.

Increasingly, we work with business

owners. Comprehensive Financial

Planning can help model the

options and awaken owners to the

possibilities. Much centres around

being in control and being aware of

what they could sell their business for

and not what they think they must sell

the business for.

The overall issue facing the advisory

sector and indeed the country, is

the fundamental need for greater

financial education. In my experience,

despite the onset of the internet, a

large proportion of the population

are ignorant as to their possibilities.

Worse still is when information from

the internet is used in isolation (akin

to self-diagnosis of medical problems),

without perspective.

Education is dear to my heart, having

previously worked as a teacher,

albeit many years ago. Where are we

supposed to learn all this stuff? In

recent years, I have delivered talks in

schools around money management

and have enjoyed having an impact.

I recognise though, that one off talks

may inspire but they don’t create

positive habits and behaviours.

A programme of learning should

be the way forward. As a result, we

became involved in the Dorset Young

Chamber. We are the founders of a

strategy whereby businesses sponsor a

school to strengthen the links between

education and business, with a view to

preparing young people for adulthood.

Fundamentally, it’s all about making a

difference.

Our planning tools benchmark the returns required to meet the desired outcomes

““

Members of the Blue Sky team

Our modern office in Poole

WORK & PENSIONS

25HARRIS BEGLEY |

Matt Begley, Managing Director

AT A GLANCE

» Established in 2003

» Four offices across Cornwall and Devon

» Founders have more than 50 years of combined financial services sector experience

» Professional advice on savings, investment, income protection, mortgages, life assurance, pensions and retirement planning

Founded in 2004 by Matthew Begley and Ian Harris, both of whom had been involved in large-scale corporate financial service businesses, Harris Begley Financial Planning

has grown into a fully-fledged financial planning practice. The company, based in Penzance, offers a full range of core planning services, but has recently seen a significant increase in interest from their clients in all aspects of Later Life Planning (LLP) thanks to the convergence of several factors.

Helping an ageing population

First, Britain’s population profile is ageing. In mid-2014, the average age in the UK exceeded 40 for the first time. By 2040, nearly one in seven people is projected to be aged over 75. The proportion of the working age population aged between 50 and the state pension age (SPA) will increase from 26% in 2012 to 35% in 2050 – an increase of approximately eight million people.1

At the same time, the squeeze on public expenditure is likely to continue and the elderly care issues that played a major role in the recent General Election are set to be a recurring theme. We’re all going to have to face up to the fact that we will have to pay more for our care in the future.

Unfortunately, this is all happening as retirement funding is being squeezed. The prolonged period of low interest rates is putting pressure on those saving for later life. In addition, the pensions shortfall resulting from inadequate pensions saving through defined contribution schemes means that pension pots are smaller than they were in the defined benefit plan era. With people living on average 21 years after retirement2 this is going to be a pressing issue.

Decisions in the hands of the consumer

The good news is that recent legislative changes have put more of the LLP-related decisions in the hands of the consumer. Since April 2015, those aged 55 or over have had the freedom to take their entire defined contribution pension fund however they choose. This includes the option to draw an income whilst remaining invested, or purchase an annuity. Moreover, unlike in the past, remaining pension assets can now be passed down to children on the death of the fund holder – tax free if the pensioner dies before 75 or treated as earned income if thereafter.

1 Government Office for Science: ‘Future for an Ageing Population’ report. https://www.gov.uk/government/

uploads/system/uploads/attachment_data/file/535187/gs-16-10-future-of-an-ageing-population.pdf2 Old Mutual Wealth: p. 7 https://www.oldmutualwealth.co.uk/globalassets/documents/retirement1/

retirement-report_low-res.pdf

Harris Begley

Retirement funding is being squeezed. The prolonged period of low interest rates is putting pressure on those saving for later life

“

“

https://www.gov.uk/government/

https://www.oldmutualwealth.co.uk/globalassets/documents/retirement1/



26 | HARRIS BEGLEY

While this new freedom is welcome,

it comes with a burden of choice. For

one thing there are tax implications as

only the first 25% lump sum is tax-

free. There are risk factors – drawdown

products mean that remaining funds

are exposed to the vagaries of the stock

market – and finally, there is the overall

issue of ensuring an adequate income

stream to fund ongoing living expenses.

Other sources of funds

The pension shortfall has also increased the focus on other sources of funds, particularly the single largest asset that most people hold: their homes. According to the Equity Release Council (ERC), total homeowner equity in England reached £2.6 trillion in 2016 of which £1.8 trillion belonged to households with homeowners aged 55 or above. And there are more homeowners in the UK (17.7 million) than there are employees with pensions (10.3 million) so housing is a much more widely held asset.3 Looking at savings as a whole, it’s important to recognise that paying off a mortgage is a form of saving as it builds housing equity. The ERC reports that in 2016, total mortgage repayments were £62.7 billion – those total savings compare to £70 billion total contributions to all private pensions.

Since, according to the Office of

National Statistics, more than two

thirds of over-65s are homeowners

with no mortgage, this is a huge

potential source of later life income.

The numbers show that borrowing

against the value of a home – Equity

Release – has now come of age

with £2 billion of lending in 2016.

Nevertheless, there is still a lingering

stigma attached to later life borrowing

– ‘paying off the mortgage’ has long

been a source of pride in the UK and

there is resistance to ‘going back into

debt’ later in life.

3 Equity Release Council report: ‘The Future of

Equity Release’

There are more homeowners in the UK than there are employees with pensions so housing is a much more widely held asset

““

While understandable, this really makes little sense. Many retirees don’t want to downsize, either because they are reluctant to move from the area in which they have spent their lives or because they want the space to accommodate their children, spouses and grandchildren when they visit. So instead of being forced to choose between moving or staying put and being short of income, Equity Release offers a third option that allows the homeowner to continue to live in the family home.

But, as with pensions, homeowners contemplating Equity Release need to make the right choices. There are many different providers and options – for example, Equity Release can be in the form of income or a lump sum. It is critical that retirees are able to access the equity in their homes without excessive charges and without having to take on unwanted additional risk.

Finances after retirement

The message then is clear. Well before reaching retirement, it’s critical that people take Later Life Financial Planning seriously and approach it in a holistic fashion; it’s about much more than just a pension annuity now. Moreover, retirement is no longer a fixed concept with many choosing to continue working on a reduced hours basis for longer, winding down rather than stopping altogether. With a much wider range of choices available, it is no surprise that Harris Begley are finding that clients are increasingly eager to engage in discussions about their post-retirement financial options.

As the choices open to individuals regarding their financial plans for later life continue to grow in number and complexity, demand for LLP advice looks set to increase significantly. It is important that regulated firms like ourselves keep striving to raise the standard of advice offered. High-quality advice, based on up-to-date knowledge of the area, should be available to all who need it.

WORK & PENSIONS

27SMITH & PINCHING |

David Hughff, Managing Director

ABOUT DAVID HUGHFF

» Joined Smith & Pinching in 1988, became a Director in 1992 and Managing Director in 1995

» Combines running the company with advising a core number of clients

» In his early career, spent ten years working as an analytical chemist

» A family man, his greatest passion is cars – both as a driver and a Formula One spectator

Smith & Pinching forges its own path: I won’t accept the limitations of being reliant on the big insurance companies that have dominated the financial services industry. We

find better ways to ensure that we can provide a coherent and complete service for our clients. I don’t believe in compromise when it comes to our clients’ best interests and am proud to lead where others follow.

The firm has been providing independent financial advice to clients in East

Anglia for over 40 years. This longevity gives us a solid foundation: we have

strong links with other professionals in our region and have the confidence –

and loyal client base – to hold out for quality rather than earning a ‘fast buck’.

We were one of the first to introduce a retained income model in the 1990s,

basing our income on agreed annual remuneration rather than hitting the client

with a large initial charge (as was traditional at that time). We were also first

in the region to introduce fee-paying discretionary asset management, offering

clients a proactive service to adjust their investment portfolios within agreed

parameters to reflect market changes. It was 10 years before the majority

of firms followed suit with retained income and most are still not offering

discretionary management.

Chartered status

We were the first firm in the area to be awarded the Chartered Firm designation. In

addition, many of our advisers hold individual Chartered status. I firmly believe that

the Chartered standard should become required for firms and individuals across

the sector within the next 10 years. Quality of advice together with a strong ethical

compass should underpin every firm and we cannot expect to win the respect of

the wider professional circle without it.

In-house investment management

We have our own team of investment managers rather than relying solely on

outsourcing to City fund managers. We work with external fund managers too, if

the client’s circumstances make that more suitable. The key is choice for the client:

I am committed to maintaining and improving the range and quality of the service

we bring to our clients.

The Smith & Pinching ethos

Professionalism is our watchword. We’re a sound, consistently forward-looking

business and I believe that strong leadership and constant evolution are key

elements of our success. We are always looking to grow the business and to

finding the next edge.

Smith & Pinching



28 | SMITH & PINCHING

We invest in our staff at all levels.

I believe that every member of

the team should be given the

opportunity to grow and develop

with the business and we encourage

appropriate study for everyone.

We have worked hard to create a

common vibrant culture: with the

creative and dynamic people we have

on our team this can sometimes be

a challenge but putting a backbone

in place that everyone can believe in

has been one of my highest priorities.

I’m proud that Smith & Pinching

is a good place to work and that

clients find our people professional

and supportive.

Growing the business

Our growth over the past 40 years

has mostly been through building

our client base organically, by word

of mouth referrals and by making

ourselves known to potential

clients through effective marketing.

However, we have recently acquired

two local firms, adding their business

and clients to our overall bank. We

have also developed joint ventures

with other professional firms to

extend the range of client services we

can offer.

Independent advice

There has been much discussion in the

Financial Advice sector about the value

of independent advice. I firmly believe

that the continued availability of truly

independent advice is fundamental

to the future financial well-being of

individuals throughout the UK. We

are living proof that the independent

model can and does work.

The Financial Advice sector has changed

greatly over Smith & Pinching’s 40 year

history. We are better qualified and

better equipped to provide advice and

the public is better protected against the

rare occasions when things go wrong.

Our regulatory framework is robust

and demanding with all firms required

to provide evidence of suitability of

advice and transparency in charging

structures. This is all to the good, but

the cost to advice firms of supporting

the regulatory framework has escalated

in recent years. Our greatest challenge

is to meet the cost of regulation but

continue to provide affordable advice.

Our strength and commitment to

quality will ensure that we can remain

at the top of our profession, despite

the challenges ahead.

We were the first firm in the area to be awarded the Chartered Firm designation

“ “

» S M I T H & P I N C H I N G ’ S S E R V I C E S

» Personal financial planning– Investments and investment

management– Retirement planning and pensions– Life and health protection – Inheritance tax planning– Equity release– Care fees planning– Mortgage advice– Property insurance

» Corporate financial planning– Workplace pensions– Staff benefit schemes– Business protection– Directors’ strategies

AT A GLANCE

» Based in Norwich and serving clients throughout East Anglia and

beyond

» Founded in 1973 by Barry Pinching and Gerry Smith

» Barry Pinching’s son, Scott Pinching, is now the Finance Director

of the firm

» David Hughff and Scott Pinching are the controlling shareholders

» Employs 84 staff

» Has around 7,500 clients across a spectrum of services with

approximately £900 million of assets under influence

» Achieved Chartered Firm status in 2009

» www.smith-pinching.co.uk

http://www.smith-pinching.co.uk/

WORK & PENSIONS

29D G PRYDE |

Douglas Pryde, Founder of D G Pryde Limited

AT A GLANCE

» We have £200 million under management, providing a bespoke service in the UK and Europe to over 1,000 clients

» Offices in the Scottish Borders, and will shortly have an English office for clients south of the border

» Highly respected IFAs with over 40 years’ experience, we are wholly independent and are directly authorised and regulated by the FCA

» Our range of financial services for businesses include corporate tax planning, business financing and debt, staff benefits set-up, key personnel insurance

» For individuals, we look at managing wealth with pension planning, savings and investments, insurance and protection, estate and succession planning, bespoke Investment Reviews, excellent model portfolio record

» Why not allow us to undertake a financial review for you, to ensure that your existing arrangements are still appropriate? To put this in motion please contact us

» www.dgpryde.co.uk

My name is Douglas Pryde and I am the founder of D G Pryde Limited. I have worked in the financial industry for over 40 years and founded my organisation

in 2005. Together with my colleagues, we have built up a substantial and loyal client base. We are wholly independent and are directly authorised and regulated by the Financial Conduct Authority (FCA). Currently, we find that referrals from satisfied clients lead to much of the new business generated for our company and we are proud of our record and achievements. We have £200 million under management, providing a bespoke service in the UK and Europe to over 1000 clients.

Performance justifies fees

Our unique investment approach has produced a marked outperformance of our

model portfolios compared to sector averages. I feel independent financial advisors

(IFAs) worth their salt (I include D G Pryde in this category) should be able to point

to above-average growth in clients’ assets as a key reason for justifying fees. We

show that our forensic approach to investments – combined with attentiveness to our

valued clients – has been instrumental in our company’s organic growth over the years.

Our investment approach

We carefully examine the occurrences within investment funds by way of regular fund

managers meetings and detailed appraisal. We address outlook at our Investment

Committee meetings before deciding on which ongoing investment compositions to

use for our clients. Our approach is therefore both quantitative, through looking back at

fund performances and ratings, and qualitative, looking forward at economic, political

and market outlook to help identify how funds will perform. We take great care to

ensure that our risk-adjusted model portfolios are in keeping with our clients’ attitude to

risk, and discuss this aspect during regular on-going investment reviews. These bespoke

reports, much appreciated by our clients, have evolved over time and cover many

aspects of our clients’ investments – and we are proud that the feedback is excellent.

Diversification is a must

The choice of asset classes to use in each portfolio is extremely important, and experts

suggest it is the most important influence on investment returns. Nonetheless, asset

allocation providers vary considerably in the way in which they allocate weightings.

It is important to note that the ‘best’ asset allocation does not exist and there is no

consensus on this. Our own asset allocation approach is strategic, in that we may

tilt asset class weights periodically, in accordance with the conclusions drawn from

our quarterly Investment Committee meetings. Diversification is essential when

constructing an investment portfolio, and the adage, do not place all your eggs in

one basket is obvious. We would agree, but we also go to great lengths to overlay

the asset allocations with top-rated funds and managers charging sensible fees.

D G Pryde

http://www.dgpryde.co.uk/



30 | D G PRYDE

Independent advice is essential

Independent advice is hugely preferable to fettered advice, where a tied adviser is usually attached to a bank or financial institution, and so can only recommend products from a restricted sample. These are often poorly-rated instruments that produce inferior returns over time. On the other hand, we can consider all products, and are unrestricted in the choice open to our clients. We address such issues as charges, investor protection, financial strength, service levels and fund coverage, all to the benefit of our clients. We set great store by this aspect.

Pension simplification – not so!

Pension simplification is a bugbear for many IFAs and their clients. More than a decade after the Government introduced pension ‘simplification’ which was supposed to make pension provision easier to understand and administer, the result has been quite the opposite. We now have seven forms of Lifetime Allowance Protection, together with, for certain individuals, Protected Tax-Free Cash and Protected Pension Age. Many individuals are subject to the ‘new’ Lifetime Allowance of £1 million. We would argue that a fund of this size may be insufficient to provide an adequate retirement income. Additionally, we think the concept is a waste of everyone’s time. Let’s keep this in perspective; Lifetime Allowance tax charges have generated revenue to the Treasury of around £300 million, in total, since April 2006. On the other hand, tax relief on pension contributions results in a cost to the Treasury of some £48 billion each year, as well as the loss of income tax on higher pensions. What the Financial Services industry want to see is the removal of the Lifetime Allowance – and if necessary, at the expense of an element of tax relief.

Access to advice and advisers

The regulator also plays an enormous

role in boosting investor confidence

in a multi-billion-pound Financial

industry which, post Brexit, will become

increasingly important to the UK

economy. Regulation has arguably stifled

competition and resulted in restricted

access to advice and markets. We ask

the Government and FCA, please,

stop tinkering. During our interaction

with clients and peers, we see that

confidence has waned in pension plans.

Due to retrospective legislation, pensions

are no longer perceived as long-term,

tax efficient solutions and stability in

regulation would help Financial Advisers

and their clients.

Shun web-based solutions

Mergers and acquisitions have led

to the demise of many respected

household brands. This gradual

consolidation has left huge swathes of

society without life insurance savings

plans. Those of us old enough will recall

the insurance salesman arriving at the

door to collect the weekly premium.

This process helped to garner trust

and company loyalty, not to mention

providing a source of employment. The

same can largely be said for individuals

seeking independent, quality financial

advice where there are considerable

advantages in meeting with a qualified

expert, who takes pride in his work,

is not fettered to a company and can

offer independent advice – an IFA

who is prepared to listen attentively

and sympathetically to the client’s

needs and objectives. This can be

advantageous in ascertaining a salient,

valuable long-term strategy, suited to

the client. On the other hand, whilst

web-based, generic solutions may

appear good value, there is a risk to

be had in taking such approaches and,

perhaps, a higher price to be paid

later. Buy cheap, buy twice.

» W A T C H O U T F O R T H E S C A M M E R S

We know that if something looks too good to be true, it almost always is. Time after time we read about scams where investors are misled. It is hugely disappointing to see that the fraudsters are winning. Whether it be from cold calls, scam emails or the theft of details, fraud is everywhere. We ask, why are the numbers increasing? Why is this elephant in the room never mentioned in the media? Last year, there were some six million fraud incidents (England and Wales Crime Survey) and only 1 in 26 of these were reported to the Government’s inadequate body Action Fraud, where investigation rates are low and the likelihood of losses being recouped are negligible (Which?). The system is struggling and the Government must act to prevent more harmful and distressing crime. Regarding avoiding unregulated financial products, we urge individuals to seek sound advice from a recommended, respected IFA. A good IFA will navigate the client away from such pitfalls, by providing quality, impartial advice.

Seek independent, quality advice

“ “

WORK & PENSIONS

31GOODMANS FINANCIAL PLANNING |

Andrew Moore, Managing Director

AT A GLANCE

» Chartered Independent Financial anners based in Devon

» Looking after 216 households, with approximately £80 million under management

» A rapidly growing business expected to hit £1.3 million of billing in 2017 with an annual growth rate of approximately 50% for the last three years

» Future growth expected at similar levels

» A client retention rate of 95%+

Goodmans Financial Planning is a Chartered firm which specialises in planning for those who are coming up to, or are already in retirement. The business serves a

growing community of clients in Devon and across the South West, operating from three offices: Plymouth, Totnes and Exeter. Goodmans are directly authorised with the Financial Conduct Authority (FCA) and are fully independent.

Who are our clients?

Our clients typically come to us in their early 50s, when the worry about retirement has increased sufficiently to overcome any reluctance to take advice. They are clutching pieces of paper with pension details and they have decisions to make. They come to a firm like Goodmans to work on their plans and to arrive at confident decisions that give them a sense of certainty, security and excitement about the future.

In the majority of cases, we find that prospective clients are more pessimistic about their retirement and futures than they need to be. We also find that our clients are delegators of decisions, and actively seek advice and support to arrive at a confident future. They have no desire to scour the internet to figure out what they should do and simply need the reassurance of a considered approach that takes account of their whole life and objectives.

How we deliver our service

Goodmans have embraced technology and have embedded cashflow modelling tools into the heart of our service. When we sit down with a new client we create a visual timeline of their future lives. On this timeline they can see how their financial future works. With this objective view of their lives in place, decisions have a context that is specific to them. Our clients then work with us to craft their futures to suit their aspirations, and to manage any fears they might have.

This approach gives us a clear idea of how their cash will flow throughout their lives, what the likelihood is that they will run out of money, how much investment return is required to meet their needs and, most importantly, how much fun and additional lifestyle they can enjoy.

For new clients, we provide the initial planning without charge. It is our chance to get to know the client and for them to understand the value of our service. Often their objectives are uninformed when we first meet and are usually very different at the end of the process.

If we make recommendations then our fees are chargeable on implementation, and if the client doesn’t see any value in working with us then they have lost nothing. We are typically taken on as financial planners by 70% – 80% of the new clients we meet and then serve them throughout their lives. It therefore makes commercial sense for us to remove the charges barrier that puts people off taking advice.

Goodmans Financial Planning



32 | GOODMANS FINANCIAL PLANNING

The clients’ plans are revisited each year in a forward planning meeting and the investment governance is managed on an ongoing basis. Each client can cease utilising our service at any time and at no cost to them, with just seven days’ notice.

This planning-centric service relationship creates many insights and it also creates a focus on four key areas:

1. A shortage of time and not money

We know that clients slow down somewhere between 70 and 80. This makes the years between 55 and 70 a key time for retirement aspirations. The clients have the time, money and energy to enjoy themselves and to make the most of the rewards from active careers. However, this time is limited and a focus on the ‘return on those years and not on the money is crucial.

2. The investment growth required is less than the market provides.

When you understand a client’s whole financial affairs you can calculate what investment return is required. We rarely meet any clients who need a return above 4% – 5%. A portfolio of low cost funds can collect the required returns without any speculation, market timing or expensive active fund management.

3. Investment anxiety robs retirees of precious time.

The last thing any retired couple needs is investment anxiety. There will be market crashes during the period of retirement and a speculative, investment-centric approach will trigger behavioural responses that will lead to bad investment and lifestyle choices. The retiree cannot make up three to four years of inertia and worry and so needs to be able to ride through investment downturns without concern. A financial planning-centric approach removes these anxieties and boosts the quality of these years.

4. Capital is there to be spent and not hoarded.

It is common for the newly-retired to hoard capital and savings and to cut back on lifestyle expenditure. This is clearly effecting the economy, as wealth pools up in older hands rather than being spent on goods and services. We find that proper planning raises confidence amongst retirees and helps them spend that capital knowing that their security isn’t at risk.

Company, industry and economic growth

Goodmans have increased the level of client billing from approximately £350,000 in 2014 to an expected £1.3 million in this financial year. This has created eight new well-paid jobs, and this growth is set to continue at an increasing rate. The demand for financial planning services far exceeds the current levels of financial planning capacity. The financial planning service industry is therefore set for ongoing growth.

This Service industry makes a positive impact on our retirees’ security and quality of life but it also has a positive impact on the wider economy. Helping the retired gain the confidence to lift their lifestyles and expenditure is crucial for an economy that has huge reserves of wealth locked up in anxious retired hands. The money needs to flow towards goods and services to create the jobs and taxes that ultimately support the public sector.

The Pension Freedoms announced by George Osborne have created flexibility for clients, enabling them to craft more fulfilling lives. It is the financial planning industry that is helping to unlock that wealth for the benefit of the treasury, the economy, the tax payer and, importantly, the retiree. Firms like Goodmans are at the forefront of making those policies a success for all the interested parties.

Our clients are delegators of decisions and actively seek advice and support to arrive at a confident future

“

“2017 annual client lunch

Relaxed, confident and at- ease with their wealth

Clients understanding long term investment trends

WORK & PENSIONS

33PWH FINANCIAL PLANNING |

Philip Hirst, Managing Director, PWH Financial Planning Ltd

AT A GLANCE

» Founded in 2009 by Directors Philip Hirst, Russell Peaker and Jonathan Wade

» Headquartered in Guiseley, Leeds

» Independent financial advisers covering pensions, savings and investments, tax, protection, estate planning, trusts, corporate services and employment benefits

» Financial Conduct Authority (FCA) regulated

» Employs 16 members of staff

PWH Financial Planning Ltd was established in 2009 as independent financial advisers, the brainchild of a trio of seasoned industry professionals possessing a vision of

how they wanted to serve clients. Their intention: to do things differently to their peers in recognition of the need for bespoke advice in an increasingly complex world.

The company started with a team of five people; Directors Philip Hirst, Russell Peaker and Jonathan Wade, with two part-time administrative staff. It arrived into the market with a loyal client bank built up over many years and a desire to do things its own way. Operating totally independently and impartially, the company sells itself on offering clear, personalised and tailored advice to individuals and companies, in contrast to a market that has become more complex and cloaked in jargon.

The timing of PWH’s formation, at the height of the global financial crisis, was certainly something of which its creators were aware. Hirst says, ‘This was a factor but it didn’t affect anything that we did because of our confidence in the existing bank of loyal clients.’ Peaker adds, ‘Decades of previous experience have seen us witness many problems, but generally we – and our clients – have emerged stronger from challenging situations.’

Growing in efficiency

In the last eight years PWH has more than trebled its team to 16 people, comprised of eight financial advisers, seven technical and administrative staff and one accounts specialist. Although the company’s ethos has remained unchanged over that time, working practices have had to be continually adapted to cope with this rapid growth whilst ensuring a seamless client ‘journey’ through the advice process and subsequent implementation.

‘We’ve increased the number of processes and systems in order to improve the efficiency of our operation,’ Hirst says. According to Wade, these have included changes to the investment process. ‘As we’ve grown, it has become more important to have a clear investment process that is applicable to all clients,’ he explains. ‘This means that while clients will have different investments to suit their individual circumstances, they will all benefit from the same underlying systems and research to ensure the most suitable outcome for each client.’ Similar changes have been continually implemented across the whole advice and administration process to improve efficiency.

A solid client base

Whilst actively looking to grow, PWH doesn’t market itself as a volume company, instead taking the view that the efficient management of existing clients’ investments and finances will automatically create goodwill and generate new customers through both personal and professional referrals. According to Peaker, ‘PWH’s existing clients tend to sit at the higher end of the market and, by giving a regular review service, we are aligning our own long-term revenue stream with our clients’ long term-wealth’.

PWH Financial Planning

The PWH Financial Planning Ltd team



34 | PWH FINANCIAL PLANNING

Hirst adds, ‘Looking after our clients drives everything we do, and this does regularly result in positive referrals for us. That’s an added bonus and has always been the main source of our growth.’

PWH has a client bank of over 1,000 personal and corporate clients, mainly the former. PWH also advise and manage a number of portfolios for trusts, charities and companies. The company has recently grown its corporate advice offering by the addition of a specialist adviser in this growing area. ‘The recent implementation of schemes such as the Government’s auto-enrolment pension initiative is presenting more opportunities with corporate clients, and also on a personal level with their employees,’ said Wade.

Regulation

While all three Directors believe regulation from the likes of the FCA has been important to clean up the industry, there is a belief that there is now too much red tape in certain areas. This can stifle innovation and is not always in clients’ best interests. Peaker feels existing regulation should be more concentrated towards financial product providers rather than advisers. For example he says, ‘We deal with a number of defined benefit transfers, and it can take up to two months to obtain information from pension trustees. This is often incomplete and further delays of another month for additional information are common. This is clearly detrimental to the client, yet there is no regulatory framework to tackle the issue.’ Peaker explained, ‘Too many providers fall back on their terms and conditions and, unfortunately, there is little optimism within our staff that providers will improve their service.’

Comprehensive services

The company’s main focus from the start has been on clients’ holistic financial planning as the Directors feel strongly that it is often difficult, if not impossible, to offer advice on a single aspect in isolation due to factors such as tax and

investment risk. Hirst characterised a typical PWH customer as ‘someone either on the verge of retirement or having recently retired, looking at generating income, capital preservation and growth, tax planning and estate planning.’ Peaker highlighted income generation as a particular problem for many clients in view of decreasing yields from cash and bonds. ‘A concern for a lot of clients approaching retirement is capital security and achieving as high an income as possible on a sustainable basis. Given retirement is a once in a lifetime scenario, reassurance is often sought and we can look at all the options, such as annuitisation or the creation of a portfolio of diversified assets to meet a client’s specific objectives and circumstances.’

A hands-on approach

The level of interaction between adviser

and client is the company’s selling

point. Despite crucial adjustments to

the company’s processes, the personal

contact with clients has always remained

central to PWH’s ethos. ‘In this sense, we

are slightly old fashioned – preferring to

see all our clients, nationwide, face-to-

face rather than via remote interactions.’

said Peaker. ‘Many larger companies

and banks have chosen to move away

from that personal relationship and we

think it sets us apart.’

Alongside regular client reviews, PWH

takes pride in always being readily

available to its clients. ‘Many people

are looking for simple things such as

the ability to pick up the phone and

get quick first-hand financial advice,

which is no longer easy through banks

or other sources,’ Hirst says. ‘The

level of trust in a client and adviser

relationship is absolutely essential

and we recognise that a permanent

commitment is needed to build this –

It can’t be fostered overnight,’ Wade

adds, ‘This is where we have excelled

in the past, and will continue to do so.’

Looking after our clients drives everything we do… the level of trust in a client and adviser relationship is absolutely essential and we recognise a commitment is needed to build this

“

“Jonathan Wade, Director

Russell Peaker, Director

WORK & PENSIONS

35PREMIER FINANCIAL MANAGEMENT |

Trevor Jackson, Director and Chartered & Certified Planner

AT A GLANCE

» Chartered Financial Planners

» Experienced and well-qualified team

» Wealth management service to private clients

» Employee benefit advice to corporate clients

» In-house investment advice with assets under management of £450 million

The first word of our strap line gives you the biggest single ingredient for success in any service-based organisation – the ability to listen to one’s clients rather than just hearing them.

Premier Financial Management is a Chartered Financial Planning practice based in Marlow, Buckinghamshire offering independent financial advice to both private and corporate clients. We help our clients and their families to plan throughout their lifetimes, enabling them to retain more of what they earn and to be more efficient with their money. We have a successful record of serving several generations of the same family. We are also a sounding board for other financial considerations. The trust that exists in our client relationships has enabled us to build a successful business based exclusively on personal recommendation.

Since our establishment in 1999, our personable approach has solid foundations built on the combination of professional qualifications and experience. We are a firm of 15 employees, with five Chartered Financial Planners, three of whom are Fellows of the Personal Finance Society (the highest professional qualification) and every employee has qualifications with the Chartered Insurance Institute. At adviser level, we share over 90 years’ experience.

Our best practice is to give all employees work ownership and responsibility, with internal ‘champion’ titles, reflecting their status as specialists. This initiative raises the bar in terms of knowledge and results in improving internal processes, which in turn contribute to a positive client experience. We have core values, which is a charter acting as our guiding principles for our behaviour towards clients and colleagues.

We intend to continue our path of organic growth against a backdrop of considerable industry change, where the largely venture capital-backed industry consolidators prey on the aging population of financial advisers. We are at the end of the first phase of our organic growth strategy and the next five-year plan will see further expansion, without losing our nimble, family appeal. Our view is that rapid expansion can compromise quality and we advocate steady, carefully-managed growth that will enable us to increase our capacity while maintaining our high standards.

The regeneration of advisers is part of the business plan, and the next generation of advisers will undoubtedly be transacting with clients in a different way due to technological changes. For us, the fundamentals must be embedded in any employee – the qualities of integrity, intelligence, discretion and impartiality.

These are challenging times for all – the more risk-averse investors have had either to settle for a real loss on their capital after tax and inflation if they remain in cash, or often make a potentially uncomfortable change to their attitude to investment risk.

Brexit will undoubtedly have the effect of prolonging the low returns of bank and building society deposits and yet £59 billion was invested in cash ISAs in 2016.

Premier Financial Management

We give all employees work ownership and responsibility, with internal ‘champion’ titles

“

“



36 | PREMIER FINANCIAL MANAGEMENT

It is a staggering 11 years since interest

rates last went up in the UK and this

has coincided with most equity investors

enjoying a bull market for the past nine

years. What a fantastic environment to

have geared up in and invested! Looking

forward, many new homeowners with

mortgages may not have experienced

or fail to appreciate the consequences

of the inevitable increase in interest

rates (the days after Brexit provided us

with a sharp reminder of stock market

volatility). Client education highlighting

potential risks is core to our approach.

We believe that there are often

‘unintended consequences’ of the

ever-changing financial services

legislation (often short-term political

tinkering with longer-term planning)

that we have to navigate for the

benefit of our clients.

» The treatment of death in service

benefits for the employed is a prime

example. The combined value of

the pension fund and the death

in service benefit is counted at the

date of an untimely death. Is it really

the intention to apply a pension

tax at the punitive rate of 55% on

the excess over £1 million? Some

employees may even unwittingly

breach their pension Fixed Protection

by membership of the wrong type

of death in service arrangement.

Employees struggle to comprehend

this while their employers struggle to

interpret the law on how to provide

this cover efficiently

» A further example is the complexity surrounding the Annual and Lifetime Allowances, which in almost all cases requires advice for higher earners. If contributions are now restricted to a maximum of £40,000 per tax year why penalise investment performance with a Lifetime Allowance? This is truly a cap and collar approach to retirement planning. With full access to pension funds, pensions freedom will probably provide a future source of funding for social care – a hot topic in its own right and one that needs to be addressed

» Is it really the intention to allow those with defined benefit pension scheme benefits to enjoy more capacity for the Lifetime Allowance than those who have the investment risk of a money purchase pension? The maximum defined benefit pension within the Lifetime Allowance is £50,000 per annum; it would require an investment fund of circa £1.43 million to secure the same benefits using current annuity rates for a money purchase pensioner. It is interesting to note that only 25% of the UK workforce are members of defined benefit schemes and yet this same defined benefit group receive 75% of the tax relief attributed to pension contributions. These inequalities should be addressed.

Within our strapline we have also included the word ‘deliver’. Delivering means executing what has been agreed and also initiating an ongoing client review process that encompasses changes to tax and political landscapes, the investment backdrop, and naturally the client’s personal circumstances.

As we are constantly reminded by the mantra of a wise investment manager: ‘things will not necessarily get better or worse – they will become different’. At Premier Financial Management, we must continue to listen and adapt to find the right solutions for our clients’ changing needs in a financial environment where the rules and regulations are constantly in flux.

It is a staggering 11 years since interest rates last went up

“ “Pension Annual Allowance Tapering 2017/18

£45,000

£150,000 £160,000 £170,000 £180,000

Adjusted income

Ann

ual A

llow

ance

£190,000 £200,000 £210,000

£40,000

£35,000

£30,000

£25,000

£20,000

£15,000

£10,000

£5,000

£0

WORK & PENSIONS

37WESTERBY TRUSTEE SERVICES |

Westerby Trustee Services Limited is a bespoke provider of Self Invested Personal Pensions (SIPP) and Small Self Administered Schemes (SSAS). Established in 1996,

the company is part of the Westerby Group which employs some 50 staff across two businesses in Leicester and is headed up by principal shareholder and Chairman, Leslie McLintic. Our company values are Integrity, Independence and Service.

2016 – A landmark year for SIPP providers

2016 was a landmark year for SIPP providers with the introduction of new capital adequacy rules by the Financial Conduct Authority (FCA). For many providers this was a massive change which meant that their capital requirement increased to eight to ten times higher than previously. SIPP providers have faced a double challenge coming under FCA scrutiny regarding their risk controls in relation to alternative investments, pension liberation and pension scams.

As a direct result of the new regulatory framework there were a significant number of market exits as well as some high profile mergers and acquisitions leading to an overall reduction in the number of providers remaining in the market. This was in line with the expectations of the FCA as published in the final policy document on capital adequacy.

Over the past year, Westerby Trustees Services has experienced significantly increased levels of interest in our services from both direct clients and financial advisers, leading to record levels of new business. Building on solid foundations, we look forward with confidence to the coming year, further enhancing our reputation within the industry, continuing to deliver a high-quality service for our customers and supporting our clients in the small to medium-sized enterprise (SME) sector.

Leslie McLintic, Westerby Group Chairman

Westerby Trustee Services Offices, The Crescent, Leicester

ABOUT LESLIE McLINTIC

Leslie McLintic became a financial adviser in 1978, as shareholder and director of a financial services firm. When the firm was acquired by Commercial Union in 1987, Les established independent financial advisers Westerby Investment Management Limited and subsequently Westerby Trustee Services Limited in 1996.

Westerby Trustee Services



38 | WESTERBY TRUSTEE SERVICES

Turning to our market, many of

the remaining SIPP providers have

introduced additional restrictions on

the investments that they will allow,

leading to a segmentation of the

market into three main categories:

1. Platform SIPP providers –

usually online allowing investment

in regulated managed funds and

listed stocks and shares.

2. Intermediate SIPP providers –

allow regulated managed funds,

listed stocks and shares, access to

discretionary fund managers and

may allow commercial property.

3. Full SIPP Providers –

allow commercial property plus

unlisted shares, loan notes and

corporate bonds, unregulated

collectives and other non-

mainstream investments.

Providers in the third category carry

increased regulatory risk and must

therefore have robust internal risk

controls and procedures to sustain

their business.

Westerby has established itself as a full

SIPP provider. In order to maintain good

practice as a full SIPP provider, we have

identified the following as critical:

» Ensuring that comprehensive

management information is available

on all aspects of our business.

» Maintaining an open and frank

rapport with our regulators – the

FCA, The Pensions Regulator and

HM Revenue and Customs.

» Implementing rigorous procedures

covering all operational tasks,

training staff on correct procedures

and providing a user friendly online

procedures manual to which all staff

can refer.

» Carrying out detailed due diligence

in the following areas:

– Sources of new business – financial

advisers and other introducing

firms and professional connections

– Client identification and compliance

with anti-money laundering rules

– Pension transfers in or out of our

SIPP or SSAS

– Investments with particular

attention to alternative ‘non-

standard’ investments

» Developing accurate financial forecasts

and monitoring financial performance

to ensure compliance with FCA

capital adequacy requirements.

The directors also maintain direct day-to-

day oversight in all areas of the business.

SIPP/SSAS support for SMEs

At the same time as providing a valuable

retirement savings plan a SIPP or

SSAS can play a significant role in

the success of any SME. One of the

main attractions of a SIPP or SSAS is

the facility to purchase commercial

property which can be leased to the

member’s business.

This facility can be highly beneficial

to SMEs, releasing capital that would

otherwise be tied up in property, for

other business projects.

A SIPP or SSAS may also borrow to fund

a property purchase, using rental receipts

to service any loan repayments due.

Within the 1,500 SIPP and 160 SSAS

schemes administered by Westerby

there are some 525 UK commercial

properties. The properties comprise

mainly of light industrial units and

office space, plus a small number of

Providers must have robust internal risk controls and procedures to sustain their business

““

» S I Z E O F T H E U K S I P P M A R K E T

Total number of SIPPs in survey 762,182

Total SIPPs set up in last 12 months 122,000

SIPPs closed in last 12 months 21,000

Total value in force £195 billion

Average SIPP value £235,100

Source: Money Management SIPP Survey April 2017 by kind permission of Financial

Times Ltd

39WESTERBY TRUSTEE SERVICES |

WORK & PENSIONS

retail units, pubs and restaurants. The

average value of the properties held is

around £230,000.

Looking at the SIPP market as a whole

it is estimated that some 30,000 UK

commercial properties are held in

SIPPs. No accurate data is available

on SSAS however it is thought likely

to be a similar number of properties.

Therefore it is clear that the SIPP/

SSAS sector plays an important role

in funding the purchase of business

premises for occupation by SMEs.

Both SIPP and SSAS may also invest

in private company shares, loan notes

and corporate bonds which also serve

to support the SME business sector.

Pension freedom

In addition to the 2016 regulatory

changes, SIPP and SSAS providers

have also had to implement change

as a result of the pension freedom

legislation that was introduced in

April 2015. The introduction of flexible

annuities and flexible drawdown

arrangements allows pension income

to be varied year-on-year to suit

personal circumstances. On death any

remaining pension fund can be passed

to nominated beneficiaries.

These new flexibilities have ensured

that tax relieved pension schemes,

whether company arrangements or

personal pensions, such as SIPPs,

remain one of the best retirement

savings vehicles available.

Conclusion

With good corporate governance

Westerby has shown that it is possible

for smaller independently owned SIPP/

SSAS providers to flourish in a highly-

regulated environment and to benefit

from the reduced competition that has

resulted from tougher regulation.

We pride ourselves on being a bespoke

provider of pensions for discerning

investors, high net worth individuals

and business owners; operating within

our values of integrity, independent

and service.

SIPPs remain one of the best retirement savings vehicles available

“ “

The Westerby Team 2017



40 | AQUILA HEYWOOD

Simon Barker, Group Chief Executive, Aquila Heywood

Aquila Heywood – delivering next-generation solutions today

The UK population is underfunding necessary private savings for retirement by £850 million per day (£310 billion in 2017)1. The accrued shortfall now stands

at £9 trillion. Only half of our population in their 30s and 40s are saving adequately for later life2. A quarter of the self-employed are not saving anything at all. Auto-enrolment has created seven million new savers; however, the fact remains that contributions remain below what is required to achieve a survivable retirement income.

Countries like Australia faced the reality of an aging population and reformed pensions decades ago and employer contributions stand at 10% (the UK stands at 1%), with a third of their employers contributing more than the minimum. Australia has the world’s fourth largest private cash pot (over $2 trillion in pensions and £1 trillion in bank accounts), and it is substantially reducing public welfare liability.

In the UK, taxpayer liability is increasing and the gap between savings and need is widening. An entire generation across the UK, especially the population across South East England, will be renting throughout their working life and retirement, so will not be investing in bricks and mortar. The average 55-year-old has six times the wealth in home equity than in a pension – citizens in their 20s and 30s will have no resource for home equity release products in later life.

1 http://www.pensionsage.com/pa/UK%27s-annual-pension-savings-gap-falls-to-%C2%A3310bn-Aviva.php2 http://reference.scottishwidows.co.uk/docs/46273-2016.pdf

FACTS ABOUT AQUILA HEYWOOD

» We are the largest provider of life, pension and investment platforms in the UK and Ireland and the fifth largest in Europe

» Our software platforms administer the benefits of over 10 million people

» Our clients include 80% of public sector employees, as well as corporates and financial services – Aviva, British Airways, BBC, IBM, Tesco, Fidelity, National Grid and others

» We employ 250 people located in Surrey and Manchester and are privately owned

Aquila Heywood

http://www.pensionsage.com/pa/UK's-annual-pension-savings-gap-falls-to-%C2%A3310bn-Aviva.php

http://reference.scottishwidows.co.uk/docs/46273-2016.pdf

41AQUILA HEYWOOD |

WORK & PENSIONS

Improvements in diet and healthcare

mean that someone in their 30s today

will live into their 90s. However, saving

statistics demonstrate that, without

government action, a substantial

proportion will do so in poverty.

Current pensions were not designed

for decades of retirement.

The UK has begun steps toward positive

change and workplace pension auto-

enrolment has resulted in almost two

million employers offering pensions to

their staff for the first time. More pension

providers are offering good-quality

products at low charges, delivering better

value for consumers who will see far less

of their savings eaten up by fees but it is

not nearly enough; substantive change

is essential if a retirement savings crisis

is to be averted.

The solution

Mandatory employer contributions must

be increased with no employee ‘opt-out’

allowed. The current 1% should be

increased to at least 3%, and then be

increased further each successive budget

until it is at least 12%. This should

include the self-employed. This act of

leadership will be popular with every

voter. Given GDP growth and inflation

compared with flat wage growth, such

a decision would reward all employees

and benefit the state without a

negative impact to tax receipts.

Personal responsibility has a role to

play. Tax incentives must be protected

to reward all voters for reducing their

future liability on the state. Great care

must also be taken with medium-term

savings products like the new lifetime

ISA; we should carefully consider

reasons one can ‘cash-in’ and we must

acknowledge there will be a temptation

within the Treasury to push people

solely toward these products rather

than age-locked pensions (pensions

are pre-tax, ISAs are post-PAYE). The

problem with medium-term accessible

products is that there will be too many

opportunities to spend – the cost of children, divorce, depreciating assets.

To change people’s savings behaviour requires a new approach to engagement. The UK population is disengaged from the pensions industry and rarely considers retirement saving until their 40s.

People are different – their attitudes to money, their level of financial understanding, their aims for later life, their careers, where they live and their family status.

We must correctly engage with all taxpayers on a personal level – not giving just a message exclusively of retirement and old-age (where there is a natural emotional inclination not to engage) but to provide digital resources to assist voters attain financial goals across an entire life journey.

To change people’s savings behaviour requires a new approach to engagement

“

“

Infographic on why we don’t save enough



42 | AQUILA HEYWOOD

Making long-term saving personal

Personalising engagement is no longer

difficult, nor expensive. Using big data

to segment the population is not new.

Pension providers are yet to embrace

modern solutions that can analyse

customer information, integrate it with

external profile data and pull together a

financial summary in a view that considers

the individual’s total financial position.

The Pensions Dashboard is one

essential component for engagement.

Once delivered, consumers will be

able to see all their pension savings

in a single place. Research shows a

person’s interest in long-term savings

really starts to grow once the total

value equals one year’s annual salary.

Delivering next-generation solutions today

Aquila Heywood has commissioned

its largest investment programme in

our 40-year history to develop toolsets

that create comprehensive views of

each pension member based on their

personal circumstances, preferences and

profile. We have access to more long-

term savings data on individuals than

any other entity in the UK (we provide

the technology that covers almost a

third of the working population). This

allows nuanced trend analysis. Our

solutions target an individual’s personal

circumstance; delivering simple, clear,

understandable communication via the

customer’s preferred channel.

Our mission is to empower voters to

take responsibility for their financial

well-being and enable them to make

informed choices. This is supported

through the deployment of industry

dashboards, planning tools, guided

education, and automated advice.

This digital approach ultimately results in

improved service, lower cost products,

increased transparency and maximum

value for the consumer.

The impact on the industry

Achieving a more financially-engaged

population benefits the economy and

the government. By encouraging a

strong saving habit, we improve the

chances of individuals living adequately

in self-supported retirement, thereby

reducing reliance on the state. Employers

benefit as their staff can afford to retire,

enabling the workforce to be refreshed

and business competitiveness improved.

Increased long-term assets are used to

support major infrastructure programmes

which will create jobs. What starts with

government leadership and technology-

led consumer engagement becomes

a virtuous circle of benefit for the

economy, employers, and taxpayers.

Aquila Heywood technology solutions

WORK & PENSIONS

43WHICHERS IFA |

Diane Whicher, Director

AT A GLANCE

» Independent financial and wealth management advisers based in Coulsdon, Surrey

» Family business founded in 1965

» Specialises in pensions, investments, retirement planning and taxation

» Mortgages, protection cover and general insurances

Regulation in the financial services industry has undergone major reform but some of the Government-driven initiatives have not been favourable to either independent

financial advisers or investors, says Diane Whicher, Director of independent financial adviser and wealth management firm, Whichers IFA.

When the Financial Services Authority (FSA) was formed in 1985, becoming the Financial Conduct Authority (FCA) four years ago, its remit was to provide effective regulation of the financial services sector. It is my view that the industry regulator has proven to be ineffective and appears to operate with little accountability.

Its introduction has not always had the positive impact envisaged. For example, With Profit Funds were very attractive, particularly in terms of endowment policies which were suitable options for lower-risk investors, as they incorporated a safety element. These were effectively killed off by the regulator as they compelled insurance companies to sell a large part of the equity content within the funds when the FTSE 100 Index dropped from around 7,000 to 3,000. Being made to sell their shares at completely the wrong time led to a long-term change for insurers and these funds have never recovered and the majority have closed down. The ‘shortfall’ in the maturities of many of these policies, in place to pay off mortgages, can be directly attributed to this interference.

Introduction of the Retail Distribution Review

Further regulatory changes have made their presence felt within the industry. The unveiling of the Retail Distribution Review (RDR) by the FCA in late 2012, aimed at bringing more transparency and fairness into the investment industry, has produced mixed outcomes for companies like Whichers IFA. Although advisers having to sit professional exams certainly had its merits, other aspects have had a negative effect. RDR regulation has resulted in a large number of experienced financial advisers leaving the industry, thus causing a shortage of advice at a time when, it could be argued, more people need this particular expertise due to the complexities of pension freedoms.

In addition, advisers are having to tread very carefully which restricts some investors getting professional financial advice. Financial advice is time-consuming and costly. It has become too risky to give general financial guidance without all the ever- changing accompanying checks and paperwork. The resulting charge for the work therefore puts it out of reach for many people.

However, without this in-depth work advisers can easily become liable to a formal complaint to the Financial Ombudsman. Whilst the new setup benefits us from a financial point of view, it leaves us rather uncomfortable from a moral perspective. Giving informal, free guidance was part of the industry’s culture and now that

Whichers IFA



44 | WHICHERS IFA

has been severely restricted. Changes

appear to have been introduced

without a genuine understanding of

how the industry works and the history

of these interventions have not always

worked to its benefit.

To remedy this, I believe the Government

should consider consulting with

experienced financial advisers within the

industry and this may result in a more

effective course of action in the future.

What IFAs like ourselves are crying out

for are clear, defined guidelines that we

believe would let us operate without

the feeling of walking a tightrope.

Pension crisis

There is a fundamental lack of

knowledge within the general public

about pensions and the options

available to them and, whilst we

are there to help, our hands are tied

in many instances due to the costs

involved in providing advice and the

possible legal implications in the future,

especially if the FCA move the goalposts

as they have done in the past. Indeed,

judgements are inconsistent – are we

subject to Common Law or the law

of the Financial Ombudsman (FOS)?

This ambiguity continues to frustrate

financial advisers.

An established and trusted name

Despite regulatory challenges, the

business has stayed strong in the face

of them. A family business, Whichers

IFA was founded in 1965 by my

father, Sidney Whicher, a pioneer in

financial services seeing many changes

throughout his career. Whichers was

started from Sidney’s dining room and

has grown to a size where we are now

located in an iconic building in the

centre of Coulsdon, which is currently

undergoing major refurbishment.

In the autumn, when this is completed,

it will transform and greatly enhance

the look of the village.

We have been in these offices for

23 years and in Coulsdon for 52

years. Although many of our clients

are local, we look after people

throughout the country. In many

cases we have done so for three

generations as most of our clients are

with us for life and are succeeded by

their children and so on.

Whichers IFA specifically cater for

the needs of our clients. In line with

regulation, we offer various service

levels – offering clients different review

packages to suit each individual.

Although our total customer archive

goes into the thousands, our core

client base is made up of around 200,

excluding mortgage customers. This

allows us to give a very personal service

built on an ethos of understanding,

knowledge and commitment

to progress.

What is the secret of our success?

During my 33-year involvement with

the company I have always looked

forward, taking into consideration

the economic climate, political

influences and social trends, and I have

developed our strategy accordingly.

At the forefront would be taking into

account the needs and aspirations of

our clients.

Some events cannot be anticipated, for

instance 9/11 and other surprises, such

as the Brexit vote in June 2016 and the

2017 Election result.

Once again we have to anticipate the

future for the optimum outcome for

our clients.

Whichers has grown over the years and

we attribute our success to both our

loyal client base and our staff of many

years standing. This has stood us in

good stead during challenging industry

times and will continue to do so.

IFAs are crying out for clear, defined guidelines from the FCA

“ “

Home of Whichers IFA, Coulsdon

The Whichers Team

WORK & PENSIONS

45CHANTLER KENT INVESTMENTS |

David Glass, Partner

AT A GLANCE

» Independent financial adviser providing personal and corporate client services

» Based in Orpington, Kent with appointed representatives in Manchester and Northern Ireland

» Founded in 1993

» Employs 25 staff

» Has approximately £200 million worth of funds under management

Chantler Kent Investments (CKI) is a long-established firm of financial advisers, having built an excellent reputation through personal service and quality staff. Founded over

24 years ago by partners David Glass and Claude Carletide, CKI has grown its individual and corporate client base into one of the leading financial advisers outside the London financial epicentre.

A hand-picked team of highly-qualified advisers, supported by a mature and dedicated administration team, CKI’s success is as much a result of high-quality personal service as the specialist expertise available to its clients. Being a smaller provincial firm, client satisfaction is paramount which is evidenced by the hundreds of longstanding clients placing their trust in CKI.

In addition to the nine fully-qualified, authorised financial advisers at the Orpington Head Office, CKI works with two appointed representatives in Manchester and Northern Ireland. The Orpington base is also home to Mediclub, its subsidiary, offering special independent financial advice to members of the medical and dental professions.

A one-stop shop for financial planning

Business growth has been gradual but expansion more rapid in recent years. Apart from occasional acquisitions, one of the principal reasons is because a formative decision was made to embrace the fee-based concept advocated by the financial regulators. As a result of this and a focus on high-quality service and impartial advice, funds under management now exceed £200 million. CKI offers a bespoke advisory service incorporating tax planning, personal and corporate protection, mortgages and commercial finance and retirement provision.

These services often extend beyond the life of a client, with their next of kin able to rely on the company to finalise all their affairs, making it easier to resolve traumatic situations. The personalised service is a key differentiating factor, and by insisting that major interaction is conducted on a face-to-face basis, this approach often results in existing client referrals, thus further enhancing CKI’s reputation through the traditional word-of-mouth basis. In addition to our team of senior, experienced advisers, we offer a platform for young graduates to train and study within the profession, with the ultimate aim of becoming fully-qualified, authorised financial consultants whilst benefiting from the expertise of their senior colleagues.

Changes around planning and pensions

One big debate in the industry lies around the transfer of occupational pension schemes. The regulator is in the process of scrutinising and closing down large operators in this sector as a result of their process-driven advice. CKI takes the opposite stance from this approach through personal work, giving specific recommendations to individuals. Firms like ours are well positioned to benefit from these important law changes that have occurred in recent years.

Chantler Kent Investments



46 | CHANTLER KENT INVESTMENTS

The Government has also implemented significant changes to pension freedoms whereby individuals age over 55 are allowed access to their pensions in one lump sum. Whilst much has been made of where this money is going once individuals have access, a more pertinent issue is the long-term effect of this policy and the position in which clients could subsequently find themselves.

Some individuals have become known as ‘insistent clients’. These are clients wishing to draw funds and expecting a financial adviser to sign this action off. Independent Financial Advisors (IFAs) like us cannot do this unless fact finding and detailed analysis is undertaken. The industry embraces the fact that this opportunity has arisen but this also confuses clients as they believe they can access their pensions under the new flexibility rules; however, we believe the monetary limit requiring advice has been set too low at £30,000.

A consolidated market

As our market share grows annually, we must consider whether this is due to the fact we are expanding or our overall market is shrinking. In the UK today, there are around 30,000 IFAs, a figure nearing 200,000 in the recent past. Since 2012, all IFAs have become fee-based operations; another marked difference to how we previously operated. This has had a profoundly positive effect, bringing with it a need to become more professional, with many advisers moving to chartered status.

The landscape has also changed due to a major cull of IFA firms over the past four years since implementation of new industry-standard exam requirements in 2013. Companies like CKI have withstood pressure resulting from radical industry changes and now operate from a strong position.

Industry changes: a way of attracting fresh talent?

This has led to some success in remedying a longstanding industry problem of bringing new talent to the

sector. The average age of a professional financial adviser is 55 which isn’t ideal. However, there is evidence of more encouragement being given to young people to enter the financial advisory sector as opposed to accountancy and legal professions. This is because, given the scope of our work, income for IFAs is normally sustainable for a lifetime. The benefits are solid, including well-paid careers and a large degree of job security. We need to ensure that the barriers of entry are never too great. If this were the case, then financial advising would be a dying profession.

CKI runs a graduate programme, increasingly common among small IFAs because insurance firms and investment houses previously offering these types of programmes have found their capacity to do so diminished. This represents a real opportunity for us to make a positive change.

The future will be even more service-driven

The financial service sector has not always been about offering a good service. This has changed due to implementation of fees and IFAs being more focused on providing quality bespoke advice, leaving the sales approach to larger, more profit-driven organisations. In future years, clients will continuously focus on quality service and, by following our unique approach, CKI will look for continued growth.

Ten years ago, we had few funds under management due to our original business model but we now have around £200 million. Traditionally, this money, in the form of pension transfers, would have benefited larger institutions but is now coming to CKI, marking a step change driven by improved service and planning.

Will this money continue to move towards more provincial, community-based companies like ours? Only time will tell, but clients are becoming more discerning, demanding better service and value for money.

Client satisfaction is paramount as evidenced by many clients who have placed their trust in us

““

Richard Gibbons, Partner

Claude Carletide, Partner

WORK & PENSIONS

47PUNTER SOUTHALL HEALTH & PROTECTION |

Paul Johnston, CEO of Punter Southall Health & Protection

At Punter Southall Health & Protection, we believe that fully supporting employee wellbeing across our diverse and evolving workforces will take centre stage going forward

The Punter Southall Health & Protection Group comprises of three companies; the award winning Punter Southall Health & Protection Limited, our consulting and brokerage

company; Psyon, our innovative technology company and RedArc Limited, our specialist nursing support company.

All three companies operate in the health, protection and wellbeing1 insurance industry, providing employee benefits consultancy and technology solutions for the employer, employee, consumer and insurance organisation. We design, create and recommend the best protection, healthcare and wellbeing solutions available.

We have achieved rapid business growth in recent years. Our revenues increased by over 360% from 2013 to the end of 2016 with turnover at £13 million, through a combined strategy of organic growth and selective acquisitions.

Today we have 170 employees in four UK locations: London, Redhill, Baildon and Chester. We provide advice and support to 5,000 consumer, 2,500 SME and 700 corporate clients. Their combined insurance spend totals just under £200million across Private Medical, Group Life, Group Income Protection and Critical Illness insurance products.

To support global clients, we’re part of the ASINTA network – an international strategic partnership of independent employee benefit consultancies.

1 Workplace wellbeing is where an organisation’s culture and environment is designed to support

individual health and wellbeing to enable employees to reach their full potential and improve

their quality of life. Individual wellbeing is defined as the way a person feels about their physical,

psychological, social, spiritual and medical state. It is not merely the absence of illness and disease.

FACTS ABOUT PUNTER SOUTHALL

HEALTH & PROTECTION

» Punter Southall Health & Protection was launched in 2010

» We work with small, medium and large companies, business partners and consumers. We have over 750 corporate clients, 2,500 SMEs and 5,000 consumer customers – each one is treated with the same care and respect

» Over 170 employees split over four UK sites in Redhill, Surrey, central London, Baildon, Yorkshire and Chester

» One of the most innovative health, protection and wellbeing advisers in the UK

Punter Southall Health & Protection



48 | PUNTER SOUTHALL HEALTH & PROTECTION

In recent years, we have been

recognised for our work in healthcare

and wellbeing with several industry

awards. In 2016, we were named

Workplace Savings and Benefit’s

Healthcare and Wellbeing Consultant

of the year and in 2015, we won Best

Healthcare Trust Intermediary at the

Health Insurance awards.

Punter Southall Health & Protection

and Psyon are accredited with Investors

in People, with RedArc accredited at

the Gold Standard.

How we Work

We are passionate about supporting

individuals and employers with

meaningful, cost-effective and relevant

wellbeing solutions. We recognise

that wellbeing is a key priority for

the employer.

For the second year running, we’ve

published an industry research

report focused on wellbeing,

‘Employee Wellbeing Research 2017: The evolution of workplace wellbeing in the UK’ in association with Reward &

Employee Benefits Association (REBA).

This research underpins our work in the

wellbeing market, providing essential

insights that shape our products and

services – insights we share with clients

and interested parties.

Our 2017 research highlighted that an

unprecedented number of companies

are now focusing on wellbeing. 45% of companies now have a clearly-defined wellbeing strategy in place, compared with less than 30% in 2016. Of those that don’t, 46% plan on implementing one this year, 24% in the next few years and 25% have it on their ‘wish list’. Most companies are focusing equally on physical and mental health issues as a key part of their strategies.

We are helping many employers by developing bespoke and innovative wellbeing strategies to enhance their employee engagement and address their health and wellbeing challenges. We are advising them at all stages in their wellbeing journey – from how to get started, how to implement appropriate strategies and how technology and data analytics can support evidence-based wellbeing programmes, through to ensuring programmes are targeted, tangible and measurable.

We have also introduced new, creative solutions to the market, backed up with accurate and meaningful data insight – solutions that are helping clients increase their wellbeing engagement and manage their wellbeing risks.

Recently, Punter Southall Health & Protection created and launched a unique wellbeing insurance product called Havensrock (www.havensrock.com). The UK’s first wellbeing enabled income protection

Most companies are focusing equally on physical and mental health issues as a key part of their strategies

“

“Healthcare is personal and we don’t forget it

http://reba.global/

http://reba.global/

http://www.havensrock.com/

49PUNTER SOUTHALL HEALTH & PROTECTION |

WORK & PENSIONS

product, it integrates insurance risk and wellbeing. It includes employee health checks provided by health measurement technology in the workplace, discounted gym membership, serious illness support and offers a wellbeing fitness tracker for employees. This solution delivers insurance and wellbeing all in one proposition, meaning it’s a benefit for all scheme members, not just those in crisis.

We have also introduced innovative digital and data solutions through our Psyon business. Psyon was set up to meet growing client demand for technology that provides an accurate and informed view of wellbeing engagement, spending and risks.

Our flagship technology solution is Elysium – a unique, online benefit administration and management platform launched a couple of years ago. Around 200 corporate clients now use the platform to manage their benefits data and administration. Elysium is transforming the management of benefits and radically shaking up the insurance industry. The system greatly simplifies the employee benefits administration challenges for companies and in turn provides accurate and up-to-date data. Elysium is designed to put employers fully in the picture about their wellbeing risk and future insurance spend, which results in more meaningful analysis and a coherent strategy.

RedArc is our specialist nursing company. We were proud to be involved in the Seven Families Initiative in 2016, an industry-led campaign that successfully raised public awareness of the financial impact of long-term illness or disability. The key value our nurses offer is the time and support they give to individuals experiencing extremely difficult circumstances. They are inspirational – a fact acknowledged by the insurance industry, many of whose policy holders have access to

We are passionate about supporting individuals and employers with meaningful, cost-effective and relevant wellbeing solutions

“

“We design healthcare and employee benefits to fit our clients. Then we build and manage them as if they were our own

the RedArc support service provided through their insurance policy.

At a strategic level, collaboration

is at the heart of our group of

businesses. We are firmly committed

to participating in key industry groups

and campaigns.

We support and challenge our views

through informed market research,

both at an individual client level

– where we undertake an internal

quality care client programme – and

through our published research, such as

the REBA Employee Wellbeing survey.

In the UK, the annual spend on

wellbeing strategies is £51-£752 per

employee and we expect this to rise

as the momentum continues to swell.

Wellbeing is not a fad, but part of a

much deeper revolution – one that will

be driven and supported by technology.

We believe strongly that the increased

focus and investment in wellbeing

will have profound benefits for

society and the state and will lead

to the employer, employee and

individual consumer re-evaluating their

wellbeing needs.

2 Employee Wellbeing Research 2017: The

evolution of workplace wellbeing in the UK,

REBA/Punter Southall Health & Protection

50 | REVIEW OF PARLIAMENT

Review of Parliament

A snap electionOn the 19th April 2017, having

repeatedly insisted that she had no

intention of calling a snap election,

Prime Minister, Theresa May, sprung

a complete surprise when she

summoned the press to Downing

Street to announce she would seek a

Commons vote to go to the country on

June 8th 2017.

It was all the more dramatic because

the first inkling came only when it was

announced that the Prime Minister

would make an important statement

outside Downing Street.

The announcement, made as

Parliament returned from its Easter

break, had the force of a thunderclap in

Westminster. Quite unexpectedly, MPs

and parties were plunged into election

mode – with no-one in any doubt that

the two thirds Commons majority,

required to trigger a dissolution, under

the Fixed Term Parliaments Act, would

be reached.

The immediate effect was to turn

what were now the two remaining

Prime Minister’s Question Times of

the Parliament into de facto leader’s

debates – especially since it was made

clear that Theresa May would not take

part in the kind of televised debates

held in the 2010 and 2015 elections.

On this occasion, her first questioner

was the Conservative backbencher,

Alberto Costa, who zeroed in on

his Party’s campaign theme: ‘Strong

countries need strong economies.

Strong countries need strong defences.

Strong countries need strong leaders.

As the nation prepares to go to the

polls, who else in this House, apart

from my Right Hon. Friend, can provide

the leadership that is needed at

this time?’

The Prime Minister did not miss a beat:

‘There are three things that a country

needs: a strong economy, strong

defence and strong, stable leadership.

That is what our plans for Brexit and

our plans for a stronger Britain will

deliver... The Right Hon. Member for

Islington North (The Labour Leader,

Jeremy Corbyn) would bankrupt our

economy and weaken our defences

and is simply not fit to lead.’

To Conservative jeers, Mr Corbyn

counter-attacked: ‘She says that it is

about leadership, yet she refuses to

defend her record in television debates.

It is not hard to see why. The Prime

Minister says that we have a stronger

economy, yet she cannot explain why

people’s wages are lower today than

they were 10 years ago or why more

households are in debt. Six million

people are earning less than the

Prime Minister Theresa May sought to strengthen her position before negotiations with the EU began

The Queen’s Speech

living wage, child poverty is up, and

pensioner poverty is up.’

The two leaders traded more

accusations with Theresa May warning

that ordinary working people would

face higher taxes and lost jobs under

Labour while Mr Corbyn claimed

the Prime Minister’s priority was ‘tax

giveaways to the richest corporations

while our children’s schools are starved

of the resources they need to educate

our children for the future’.

Brexit emerged as one of the Prime

Minister’s main campaign themes:

‘every vote for the Conservatives will

make me stronger when I negotiate

for Britain with the European Union.

And every vote for the Conservatives

will mean we can stick to our plan for

a stronger Britain and take the right

long-term decisions for a more secure

future for this country.’

The SNP’s Westminster Leader, Angus

Robertson, raised the headline in the

Daily Mail which called on the Prime

Minister to ‘Crush the saboteurs’

working against her plans for Brexit.

He said that struck a dangerous tone in

a democratic state: ‘so does the Prime

Minister agree that political opponents

are not “saboteurs”?’

Later that afternoon, the Commons

voted to call an early election, by 522

votes to 13.

What a difference. Theresa May and

Jeremy Corbyn’s final Commons

confrontation before the election

had seen the Conservatives limbering

up for a triumphal campaign which

would culminate in the inevitable

smashing of their Labour opponents.

When the diminished, battered band

The Queen’s Speech announced the government’s legislative plan for the coming Parliament

51REVIEW OF PARLIAMENT |

WORK & PENSIONS


A snap electionOn the 19th April 2017, having

repeatedly insisted that she had no

intention of calling a snap election,

Prime Minister, Theresa May, sprung

a complete surprise when she

summoned the press to Downing

Street to announce she would seek a

Commons vote to go to the country on

June 8th 2017.

It was all the more dramatic because

the first inkling came only when it was

announced that the Prime Minister

would make an important statement

outside Downing Street.

The announcement, made as

Parliament returned from its Easter

break, had the force of a thunderclap in

Westminster. Quite unexpectedly, MPs

and parties were plunged into election

mode – with no-one in any doubt that

the two thirds Commons majority,

required to trigger a dissolution, under

the Fixed Term Parliaments Act, would

be reached.

The immediate effect was to turn

what were now the two remaining

Prime Minister’s Question Times of

the Parliament into de facto leader’s

debates – especially since it was made

clear that Theresa May would not take

part in the kind of televised debates

held in the 2010 and 2015 elections.

On this occasion, her first questioner

was the Conservative backbencher,

Alberto Costa, who zeroed in on

his Party’s campaign theme: ‘Strong

countries need strong economies.

Strong countries need strong defences.

Strong countries need strong leaders.

As the nation prepares to go to the

polls, who else in this House, apart

from my Right Hon. Friend, can provide

the leadership that is needed at

this time?’

The Prime Minister did not miss a beat:

‘There are three things that a country

needs: a strong economy, strong

defence and strong, stable leadership.

That is what our plans for Brexit and

our plans for a stronger Britain will

deliver... The Right Hon. Member for

Islington North (The Labour Leader,

Jeremy Corbyn) would bankrupt our

economy and weaken our defences

and is simply not fit to lead.’

To Conservative jeers, Mr Corbyn

counter-attacked: ‘She says that it is

about leadership, yet she refuses to

defend her record in television debates.

It is not hard to see why. The Prime

Minister says that we have a stronger

economy, yet she cannot explain why

people’s wages are lower today than

they were 10 years ago or why more

households are in debt. Six million

people are earning less than the

Prime Minister Theresa May sought to strengthen her position before negotiations with the EU began

The Queen’s Speech

living wage, child poverty is up, and

pensioner poverty is up.’

The two leaders traded more

accusations with Theresa May warning

that ordinary working people would

face higher taxes and lost jobs under

Labour while Mr Corbyn claimed

the Prime Minister’s priority was ‘tax

giveaways to the richest corporations

while our children’s schools are starved

of the resources they need to educate

our children for the future’.

Brexit emerged as one of the Prime

Minister’s main campaign themes:

‘every vote for the Conservatives will

make me stronger when I negotiate

for Britain with the European Union.

And every vote for the Conservatives

will mean we can stick to our plan for

a stronger Britain and take the right

long-term decisions for a more secure

future for this country.’

The SNP’s Westminster Leader, Angus

Robertson, raised the headline in the

Daily Mail which called on the Prime

Minister to ‘Crush the saboteurs’

working against her plans for Brexit.

He said that struck a dangerous tone in

a democratic state: ‘so does the Prime

Minister agree that political opponents

are not “saboteurs”?’

Later that afternoon, the Commons

voted to call an early election, by 522

votes to 13.

What a difference. Theresa May and

Jeremy Corbyn’s final Commons

confrontation before the election

had seen the Conservatives limbering

up for a triumphal campaign which

would culminate in the inevitable

smashing of their Labour opponents.

When the diminished, battered band

The Queen’s Speech announced the government’s legislative plan for the coming Parliament




of Conservative MPs reassembled,

minus their parliamentary majority,

for the state opening of Parliament on

June 21st, they were chastened and

uncertain, while euphoria gripped the

occupants of the Labour benches.

When they came to speak in the

traditional debate on an address

thanking Her Majesty for the Queen’s

Speech – the new Government’s

legislative programme – the dynamic

between the two main figures had

changed completely. Mr Corbyn

seemed a far more confident, assertive

parliamentary performer, relishing the

opportunity to throw back the taunts

that had been hurled at him during

the campaign.

A Government which had warned

that he could only gain power in

a ‘coalition of chaos’ with the SNP

and the Lib Dems had been forced

to negotiate for the support of the

Northern Ireland Democratic Unionists

... and as the first debate of this

new Parliament began, that support

had not been secured. Mr Corbyn

could not resist the open goal. To

triumphant Labour laughter he noted

that ‘the latest coalition may already

be in some chaos’.

‘Nothing could emphasise that chaos

more than the Queen’s Speech we

have just heard: a threadbare legislative

programme from a Government who

have lost their majority and apparently

run out of ideas altogether. This would

be a thin legislative programme even if

it was for one year, but for two years –

two years? There is not enough in it to

fill up one year.’

That was a reference to the

Government’s decision to declare a

two-year Parliamentary Session – a

procedural move intended to ensure

ministers could push through vital

Brexit legislation in time for the exit

date in March 2019. Mr Corbyn

mocked the Prime Minister for

dropping a series of election promises

that had not found favour with

the voters.

‘It is therefore appropriate to start by

welcoming what is not in the speech.

First, there is no mention of scrapping

the winter fuel allowance for millions

of pensioners through means testing.

Can the Prime Minister assure us that

that Conservative plan has now been

withdrawn? Mercifully, neither is there

any mention of ditching the triple

lock. Pensioners across Britain will be

grateful to know whether the Tory

election commitment on that has also

been binned.’

Also absent from this slimmed down

legislative programme were the

Government’s controversial policy on

social care (dubbed the ‘dementia tax’

by Labour), plans to cut free school

meals, and the promised expansion of

grammar schools.

Jeremy Corbyn received a boost in support following the election

Grenfell Tower

On Brexit, Mr Corbyn stuck to Labour’s

careful positioning in favour of a deal

with the EU ‘that puts jobs and the

economy first’. He called for full access

to the single market and a customs

arrangement that provided Britain

with the ‘exact same benefits’ as now.

And in his final flourish he warned

the Prime Minister that Labour were

now ‘not merely an Opposition; we

are a Government in waiting, with a

policy programme that enthused and

engaged millions of people in this

election, many for the first time in their

political lives. We are ready to offer

real strong and stable leadership in the

interests of the many, not the few.’

The Prime Minister attempted to

puncture Labour’s mood with a

barbed welcome for Mr Corbyn’s

return to the Opposition benches

– and she reminded him that the

Conservatives still had 56 more

Commons seats than Labour. She said

her policies were aimed at ‘grasping

the opportunities for every community

in our country to benefit as we leave

the European Union; it is about

delivering the will of the British people

with a Brexit deal that works for all

parts of our United Kingdom.’ She

said the referendum vote to leave the

European Union was ‘a profound and

justified expression that our country

often does not work the way it should

for millions of ordinary families. This

Queen’s Speech begins to change

that, by putting fairness at the heart

of our agenda.’

The fire that destroyed Grenfell Tower,

a social housing block in the London

Borough of Kensington and Chelsea,

seemed to some to crystallise the issues

that had driven the ‘Corbyn Surge’ in

the General Election just days earlier.

Accusations about the neglect of

social housing tenants, chronic under-

investment and official incompetence

were flying, even while the pall of

smoke still hovered over the capital and

the horrific images of the blaze were

replayed on TV.

So potent was the symbolism that it

became intertwined in the debates

on the post-election Queen’s Speech

- but the Government also committed

to keep MPs informed about the

aftermath, the efforts to identify

casualties in the wreckage of the

tower, to re-house and assist those

who had lost their homes, and to set

up a public inquiry.

So it was that the Communities

Secretary, Sajid Javid, came to the

Commons on July 3rd to announce

£2.5 million had been distributed

from the special £5 million fund set

up to help the residents. Mr Javid said

the public inquiry and the criminal

investigation had to be allowed the

Tributes for the Grenfell victims came from across the country


WORK & PENSIONS

of Conservative MPs reassembled,

minus their parliamentary majority,

for the state opening of Parliament on

June 21st, they were chastened and

uncertain, while euphoria gripped the

occupants of the Labour benches.

When they came to speak in the

traditional debate on an address

thanking Her Majesty for the Queen’s

Speech – the new Government’s

legislative programme – the dynamic

between the two main figures had

changed completely. Mr Corbyn

seemed a far more confident, assertive

parliamentary performer, relishing the

opportunity to throw back the taunts

that had been hurled at him during

the campaign.

A Government which had warned

that he could only gain power in

a ‘coalition of chaos’ with the SNP

and the Lib Dems had been forced

to negotiate for the support of the

Northern Ireland Democratic Unionists

... and as the first debate of this

new Parliament began, that support

had not been secured. Mr Corbyn

could not resist the open goal. To

triumphant Labour laughter he noted

that ‘the latest coalition may already

be in some chaos’.

‘Nothing could emphasise that chaos

more than the Queen’s Speech we

have just heard: a threadbare legislative

programme from a Government who

have lost their majority and apparently

run out of ideas altogether. This would

be a thin legislative programme even if

it was for one year, but for two years –

two years? There is not enough in it to

fill up one year.’

That was a reference to the

Government’s decision to declare a

two-year Parliamentary Session – a

procedural move intended to ensure

ministers could push through vital

Brexit legislation in time for the exit

date in March 2019. Mr Corbyn

mocked the Prime Minister for

dropping a series of election promises

that had not found favour with

the voters.

‘It is therefore appropriate to start by

welcoming what is not in the speech.

First, there is no mention of scrapping

the winter fuel allowance for millions

of pensioners through means testing.

Can the Prime Minister assure us that

that Conservative plan has now been

withdrawn? Mercifully, neither is there

any mention of ditching the triple

lock. Pensioners across Britain will be

grateful to know whether the Tory

election commitment on that has also

been binned.’

Also absent from this slimmed down

legislative programme were the

Government’s controversial policy on

social care (dubbed the ‘dementia tax’

by Labour), plans to cut free school

meals, and the promised expansion of

grammar schools.

Jeremy Corbyn received a boost in support following the election

Grenfell Tower

On Brexit, Mr Corbyn stuck to Labour’s

careful positioning in favour of a deal

with the EU ‘that puts jobs and the

economy first’. He called for full access

to the single market and a customs

arrangement that provided Britain

with the ‘exact same benefits’ as now.

And in his final flourish he warned

the Prime Minister that Labour were

now ‘not merely an Opposition; we

are a Government in waiting, with a

policy programme that enthused and

engaged millions of people in this

election, many for the first time in their

political lives. We are ready to offer

real strong and stable leadership in the

interests of the many, not the few.’

The Prime Minister attempted to

puncture Labour’s mood with a

barbed welcome for Mr Corbyn’s

return to the Opposition benches

– and she reminded him that the

Conservatives still had 56 more

Commons seats than Labour. She said

her policies were aimed at ‘grasping

the opportunities for every community

in our country to benefit as we leave

the European Union; it is about

delivering the will of the British people

with a Brexit deal that works for all

parts of our United Kingdom.’ She

said the referendum vote to leave the

European Union was ‘a profound and

justified expression that our country

often does not work the way it should

for millions of ordinary families. This

Queen’s Speech begins to change

that, by putting fairness at the heart

of our agenda.’

The fire that destroyed Grenfell Tower,

a social housing block in the London

Borough of Kensington and Chelsea,

seemed to some to crystallise the issues

that had driven the ‘Corbyn Surge’ in

the General Election just days earlier.

Accusations about the neglect of

social housing tenants, chronic under-

investment and official incompetence

were flying, even while the pall of

smoke still hovered over the capital and

the horrific images of the blaze were

replayed on TV.

So potent was the symbolism that it

became intertwined in the debates

on the post-election Queen’s Speech

- but the Government also committed

to keep MPs informed about the

aftermath, the efforts to identify

casualties in the wreckage of the

tower, to re-house and assist those

who had lost their homes, and to set

up a public inquiry.

So it was that the Communities

Secretary, Sajid Javid, came to the

Commons on July 3rd to announce

£2.5 million had been distributed

from the special £5 million fund set

up to help the residents. Mr Javid said

the public inquiry and the criminal

investigation had to be allowed the

Tributes for the Grenfell victims came from across the country




space to follow the evidence wherever

it took them, and everyone should be

careful not to prejudice their work.

Responding to the Labour MP, David

Lammy, who had lost a family friend

in the fire, he added that although it

was for the judge to determine the

scope of the inquiry, he expected it

to be ‘as broad and wide-ranging

as possible’.

Mr Javid also dealt with the key issue

of the authorities’ inability to say

exactly how many people had died:

‘There has been much speculation

about who was in Grenfell Tower on

the night of the fire, and it is vital

that we find out. The Director of

Public Prosecutions has made it clear

that there will be no prosecution

of tenants ... who may have been

illegally sub-letting their property, ...

There may have been people living in

flats that were illegally sub-let who

had no idea about the true status

of their tenancy. Their families want

to know if they perished in the fire.

These are their sons, their daughters,

their brothers and their sisters. They

need closure, and that is the least that

they deserve.’

The Government was also taking

urgent action to avoid another tragedy

in buildings with architectural cladding

similar to that which appeared to

have been a factor in the Grenfell fire.

Mr Javid said the early findings were

disturbing: ‘So far, all the samples

of cladding tested have failed – that

is 181 out of 181. ... the priority

now is to make those buildings safe.

Where appropriate mitigating measures

cannot be implemented quickly,

landlords must provide alternative

accommodation while the remedial

work is carried out.’

The Lib Dem, Jo Swinson, raised

suggestions that the fire had been

caused by a faulty fridge: ‘so will the

Government revisit the decision of

March last year to dismiss or delay

many of the recommendations of the

Lynn Faulds Wood review into product

recall, which I commissioned [as a

Coalition minister] and in particular

look at enforcing the regulations.’

Sajid Javid said the issue was

being addressed.

The Communities Secretary clashed

with the Labour MP, Andy Slaughter,

who attacked the management

record of the local council: ‘It is an

open secret in West London that the

administration in Kensington and

Chelsea could not run a bath. That is

why the residents of North Ken have

had such a raw deal for so long. So

when will the Secretary of State put

country before Party and send in the

commissioners?’

Mr Javid retorted that Slaughter was a

local London MP: ‘he has an opportunity

now to put party politics aside and just

do the right thing for his constituents.

His constituents are watching him.’

Public anger at the tragedy was widespread, the government responding by launching an inquiry into the disaster

Back in March, when an election

seemed a distant prospect, parliament’s

main focus was on the European Union

(Notification of Withdrawal) Bill. This

Bill, which would give Theresa May

the authority to begin the UK’s divorce

from the European Union, was forced

on the Government after a Supreme

Court ruling that Parliamentary

approval was required to begin

the process.

Despite fears that the Bill could be

watered down or even reshaped

to reverse the Referendum verdict,

it passed through the Commons

unscathed. All attempts to amend,

or add, to its 136 words were voted

down. Predictions of a major rebellion

of up to 50 Conservative Remainers

proved unfounded, and only a handful

(notably the arch-Europhile former

Chancellor, Ken Clark) defied the

party whip.

But when it moved on to the House of

Lords, where there is no Government

majority and a large concentration of

pro-EU peers, the Bill was amended

twice. One change guaranteed the

rights of EU citizens living in the UK,

and the second promised Parliament

a ‘meaningful vote’ on the final

Brexit deal. That meant the Bill had

to return to the Commons because

both Houses of Parliament must agree

on the final wording of legislation.

This is the arcane process known as

‘Parliamentary Ping Pong’, with each

house voting on whether to accept or

reject changes made by the other.

When the changes were put to MPs,

the Brexit Secretary, David Davis, said

they should not be accepted. On the

issue of EU citizens, he agreed that they

made a vital contribution to the UK.

But the issue was that the European

Union would not begin talks until the

UK had begun the formal process of

leaving, so their status could not be

confirmed. Securing their status, and

that of UK citizens living in the EU, was

an early priority for the forthcoming

negotiations, he said.

He also rejected the second

amendment – giving Parliament a

vote on the final Brexit deal – as

unnecessary, because the Government

had already promised a vote. And he

was wary of a hidden agenda behind

the push for a ‘meaningful vote’,

warning: ‘what we cannot have ... is

any suggestion that the votes in either

House will overturn the result of the

referendum. That is the key point.’

Mr Davis warned that the amendment

‘effectively, seeks to prohibit the Prime

Minister from walking away from

negotiations, even if she thinks the

European Union is offering her a bad

or very bad deal ... The Government

will be undertaking these negotiations

and must have the freedom to walk

away from a deal that sets out to

punish the UK for a decision to

Last rites on the Brexit Bill

David Davis, Secretary of State for Exiting the European Union since July 2016


WORK & PENSIONS

space to follow the evidence wherever

it took them, and everyone should be

careful not to prejudice their work.

Responding to the Labour MP, David

Lammy, who had lost a family friend

in the fire, he added that although it

was for the judge to determine the

scope of the inquiry, he expected it

to be ‘as broad and wide-ranging

as possible’.

Mr Javid also dealt with the key issue

of the authorities’ inability to say

exactly how many people had died:

‘There has been much speculation

about who was in Grenfell Tower on

the night of the fire, and it is vital

that we find out. The Director of

Public Prosecutions has made it clear

that there will be no prosecution

of tenants ... who may have been

illegally sub-letting their property, ...

There may have been people living in

flats that were illegally sub-let who

had no idea about the true status

of their tenancy. Their families want

to know if they perished in the fire.

These are their sons, their daughters,

their brothers and their sisters. They

need closure, and that is the least that

they deserve.’

The Government was also taking

urgent action to avoid another tragedy

in buildings with architectural cladding

similar to that which appeared to

have been a factor in the Grenfell fire.

Mr Javid said the early findings were

disturbing: ‘So far, all the samples

of cladding tested have failed – that

is 181 out of 181. ... the priority

now is to make those buildings safe.

Where appropriate mitigating measures

cannot be implemented quickly,

landlords must provide alternative

accommodation while the remedial

work is carried out.’

The Lib Dem, Jo Swinson, raised

suggestions that the fire had been

caused by a faulty fridge: ‘so will the

Government revisit the decision of

March last year to dismiss or delay

many of the recommendations of the

Lynn Faulds Wood review into product

recall, which I commissioned [as a

Coalition minister] and in particular

look at enforcing the regulations.’

Sajid Javid said the issue was

being addressed.

The Communities Secretary clashed

with the Labour MP, Andy Slaughter,

who attacked the management

record of the local council: ‘It is an

open secret in West London that the

administration in Kensington and

Chelsea could not run a bath. That is

why the residents of North Ken have

had such a raw deal for so long. So

when will the Secretary of State put

country before Party and send in the

commissioners?’

Mr Javid retorted that Slaughter was a

local London MP: ‘he has an opportunity

now to put party politics aside and just

do the right thing for his constituents.

His constituents are watching him.’

Public anger at the tragedy was widespread, the government responding by launching an inquiry into the disaster

Back in March, when an election

seemed a distant prospect, parliament’s

main focus was on the European Union

(Notification of Withdrawal) Bill. This

Bill, which would give Theresa May

the authority to begin the UK’s divorce

from the European Union, was forced

on the Government after a Supreme

Court ruling that Parliamentary

approval was required to begin

the process.

Despite fears that the Bill could be

watered down or even reshaped

to reverse the Referendum verdict,

it passed through the Commons

unscathed. All attempts to amend,

or add, to its 136 words were voted

down. Predictions of a major rebellion

of up to 50 Conservative Remainers

proved unfounded, and only a handful

(notably the arch-Europhile former

Chancellor, Ken Clark) defied the

party whip.

But when it moved on to the House of

Lords, where there is no Government

majority and a large concentration of

pro-EU peers, the Bill was amended

twice. One change guaranteed the

rights of EU citizens living in the UK,

and the second promised Parliament

a ‘meaningful vote’ on the final

Brexit deal. That meant the Bill had

to return to the Commons because

both Houses of Parliament must agree

on the final wording of legislation.

This is the arcane process known as

‘Parliamentary Ping Pong’, with each

house voting on whether to accept or

reject changes made by the other.

When the changes were put to MPs,

the Brexit Secretary, David Davis, said

they should not be accepted. On the

issue of EU citizens, he agreed that they

made a vital contribution to the UK.

But the issue was that the European

Union would not begin talks until the

UK had begun the formal process of

leaving, so their status could not be

confirmed. Securing their status, and

that of UK citizens living in the EU, was

an early priority for the forthcoming

negotiations, he said.

He also rejected the second

amendment – giving Parliament a

vote on the final Brexit deal – as

unnecessary, because the Government

had already promised a vote. And he

was wary of a hidden agenda behind

the push for a ‘meaningful vote’,

warning: ‘what we cannot have ... is

any suggestion that the votes in either

House will overturn the result of the

referendum. That is the key point.’

Mr Davis warned that the amendment

‘effectively, seeks to prohibit the Prime

Minister from walking away from

negotiations, even if she thinks the

European Union is offering her a bad

or very bad deal ... The Government

will be undertaking these negotiations

and must have the freedom to walk

away from a deal that sets out to

punish the UK for a decision to

Last rites on the Brexit Bill

David Davis, Secretary of State for Exiting the European Union since July 2016




leave the EU, as some in Europe

have suggested.’

For Labour, the Shadow Brexit

Secretary, Sir Keir Starmer, backed

both Lords’ amendments. He said

protecting EU citizens was a matter

of principle – but he was challenged

by the senior Labour backbencher,

Frank Field, who warned: ‘if we pass

this amendment and give those rights

to European citizens here, there will

be no incentive whatsoever for other

European countries to concede those

rights to our citizens.’

Sir Kier retorted that the wording asked

Ministers to bring forward proposals

within three months, and so did not tie

anybody’s hands.

Another Labour ex-Minister, Pat

McFadden, suggested that, in the

event of no deal being agreed, the

Government was seeking the authority

to default to a trading relationship

with the EU, based on the World

Trade Organization rules – without a

Commons vote. Keir Starmer warned

that would be the worst possible

outcome, quoting the Confederation

of British Industry’s view that ‘the cost

of change is simply too high to even

consider it’.

The leading Labour leave campaigner,

Gisela Stuart, said the Government

should make the status of EU citizens

in the UK a priority, but she opposed

including the issue in the Bill: ‘I shall

vote against all the amendments on

the simple basis that this Bill has one

purpose and one purpose only: to

give legal effect to the decision of the

people on 23 June ... However, I look

to the Secretary of State to give firm

assurances that his top and first priority

will be the rights of EU citizens.’

One of the Conservatives’ leading

backbench Brexiteers, John Baron, said

the Commons, in approving the EU

referendum in the first place, had made

‘a contract with the British people ...

if there is a good deal, we will take it,

and if there is not, the Prime Minister

has made it very clear that we will not

accept a bad deal, so we move on, and

we move out of the EU.’

The Conservative, Anna Soubry, a

strong Remain campaigner, said her

Party wanted to honour the vote to

Leave: ‘now, however, we are talking

about the sovereignty of this Parliament

and about what would happen in the

event that our Prime Minister does not

strike a good deal. I trust our Prime

Minister ... but let us be under no

illusion that if she does not do so, there

will be no alternative but WTO tariffs,

regulations and rules, and the people in

my constituency certainly did not vote

for that.’

Parliament, and the general public, remain divided regarding the relationship that the UK should have with EU

The debate was held within hours

of the announcement by Scotland’s

First Minister, Nicola Sturgeon, that

she would hold a second referendum

on Scottish independence. In the

Commons, the former First Minister,

Alex Salmond, complained that the

Government had broken its promise

not to trigger the formal process

for leaving the EU until there was

an agreed ‘UK approach’ backed by

Scotland, and had ignored the SNP

compromise proposal to allow Scotland

to stay inside the EU Single Market.

And he added: ‘there might not be

a meaningful vote in this Chamber,

but there shall be a meaningful

vote in Scotland about protecting

our millennium-long history as a

European nation.’

When MPs rejected both Lords’

amendments, the Bill was sent back for

immediate consideration in the House

of Lords, where David Davis came to

watch his Junior Minister, Lord Bridges,

call on Peers to drop their opposition.

And while the Liberal Democrat, Lord

Oates, did urge Peers to continue

defying the Government, support for

the amendment melted away, and

the attempt to throw it back to MPs

was once more rejected, as was the

attempt to keep the ‘meaningful vote’.

The final form of the Bill was settled

– and it was sent off for the Royal

Assent, un-amended.

Article 50 is triggeredThe passage of the European Union

(Notification of Withdrawal) Act cleared

the way for the Prime Minister to act

on the Referendum verdict and formally

trigger Britain’s departure talks with

the EU.

She was greeted by cheering

Conservative MPs when she announced,

on the 29th March, that the process had

begun: ‘A few minutes ago, in Brussels,

the United Kingdom’s permanent

representative to the EU handed a

letter to the President of the European

Council on my behalf confirming the

Government’s decision to invoke Article

50 of the treaty on European Union.

The Article 50 process is now under way

and, in accordance with the wishes of

the British people, the United Kingdom

is leaving the European Union.’

She added that she wanted to build

a close partnership with the EU: ‘We

know that we will lose influence over

the rules that affect the European

economy. We know that UK companies

that trade with the EU will have to

Nicola Sturgeon, leader of the SNP, announced her intentions to hold a second referendum on Scottish independence


WORK & PENSIONS

leave the EU, as some in Europe

have suggested.’

For Labour, the Shadow Brexit

Secretary, Sir Keir Starmer, backed

both Lords’ amendments. He said

protecting EU citizens was a matter

of principle – but he was challenged

by the senior Labour backbencher,

Frank Field, who warned: ‘if we pass

this amendment and give those rights

to European citizens here, there will

be no incentive whatsoever for other

European countries to concede those

rights to our citizens.’

Sir Kier retorted that the wording asked

Ministers to bring forward proposals

within three months, and so did not tie

anybody’s hands.

Another Labour ex-Minister, Pat

McFadden, suggested that, in the

event of no deal being agreed, the

Government was seeking the authority

to default to a trading relationship

with the EU, based on the World

Trade Organization rules – without a

Commons vote. Keir Starmer warned

that would be the worst possible

outcome, quoting the Confederation

of British Industry’s view that ‘the cost

of change is simply too high to even

consider it’.

The leading Labour leave campaigner,

Gisela Stuart, said the Government

should make the status of EU citizens

in the UK a priority, but she opposed

including the issue in the Bill: ‘I shall

vote against all the amendments on

the simple basis that this Bill has one

purpose and one purpose only: to

give legal effect to the decision of the

people on 23 June ... However, I look

to the Secretary of State to give firm

assurances that his top and first priority

will be the rights of EU citizens.’

One of the Conservatives’ leading

backbench Brexiteers, John Baron, said

the Commons, in approving the EU

referendum in the first place, had made

‘a contract with the British people ...

if there is a good deal, we will take it,

and if there is not, the Prime Minister

has made it very clear that we will not

accept a bad deal, so we move on, and

we move out of the EU.’

The Conservative, Anna Soubry, a

strong Remain campaigner, said her

Party wanted to honour the vote to

Leave: ‘now, however, we are talking

about the sovereignty of this Parliament

and about what would happen in the

event that our Prime Minister does not

strike a good deal. I trust our Prime

Minister ... but let us be under no

illusion that if she does not do so, there

will be no alternative but WTO tariffs,

regulations and rules, and the people in

my constituency certainly did not vote

for that.’

Parliament, and the general public, remain divided regarding the relationship that the UK should have with EU

The debate was held within hours

of the announcement by Scotland’s

First Minister, Nicola Sturgeon, that

she would hold a second referendum

on Scottish independence. In the

Commons, the former First Minister,

Alex Salmond, complained that the

Government had broken its promise

not to trigger the formal process

for leaving the EU until there was

an agreed ‘UK approach’ backed by

Scotland, and had ignored the SNP

compromise proposal to allow Scotland

to stay inside the EU Single Market.

And he added: ‘there might not be

a meaningful vote in this Chamber,

but there shall be a meaningful

vote in Scotland about protecting

our millennium-long history as a

European nation.’

When MPs rejected both Lords’

amendments, the Bill was sent back for

immediate consideration in the House

of Lords, where David Davis came to

watch his Junior Minister, Lord Bridges,

call on Peers to drop their opposition.

And while the Liberal Democrat, Lord

Oates, did urge Peers to continue

defying the Government, support for

the amendment melted away, and

the attempt to throw it back to MPs

was once more rejected, as was the

attempt to keep the ‘meaningful vote’.

The final form of the Bill was settled

– and it was sent off for the Royal

Assent, un-amended.

Article 50 is triggeredThe passage of the European Union

(Notification of Withdrawal) Act cleared

the way for the Prime Minister to act

on the Referendum verdict and formally

trigger Britain’s departure talks with

the EU.

She was greeted by cheering

Conservative MPs when she announced,

on the 29th March, that the process had

begun: ‘A few minutes ago, in Brussels,

the United Kingdom’s permanent

representative to the EU handed a

letter to the President of the European

Council on my behalf confirming the

Government’s decision to invoke Article

50 of the treaty on European Union.

The Article 50 process is now under way

and, in accordance with the wishes of

the British people, the United Kingdom

is leaving the European Union.’

She added that she wanted to build

a close partnership with the EU: ‘We

know that we will lose influence over

the rules that affect the European

economy. We know that UK companies

that trade with the EU will have to

Nicola Sturgeon, leader of the SNP, announced her intentions to hold a second referendum on Scottish independence




align with rules agreed by institutions of which we are no longer a part, just as we do in other overseas markets – we accept that. However, we approach these talks constructively, respectfully and in a spirit of sincere co-operation, for it is in the interests of both the United Kingdom and the European Union that we should use this process to deliver our objectives in a fair and orderly manner. ... We will continue to be reliable partners, willing allies and close friends. We want to continue to buy goods and services from the EU, and sell it ours ... Indeed, in an increasingly unstable world, we must continue to forge the closest possible security co-operation to keep our people safe. We face the same global threats from terrorism and extremism.’

Jeremy Corbyn warned against leaving without a trade agreement: ‘the Prime Minister says that no deal is better than a bad deal, but the reality is that no deal is a bad deal. Less than a year ago, the Treasury estimated that leaving the European Union on World Trade

Organization terms would lead to a

7.5% fall in our GDP and a £45 billion

loss in tax receipts ... It would be a

national failure of historic proportions

if the Prime Minister came back from

Brussels without having secured

protection for jobs and living standards,

so we will use every parliamentary

opportunity to ensure the Government

are held to account at every stage of

the negotiations.’

He said the debate had now moved

on to what a post-Brexit Britain would

be like: ‘There are Conservatives who

want to use Brexit to turn this country

into a low-wage tax haven. Labour is

determined to invest in a high-skill,

high-tech, high-wage future ... Labour

will not give this Government a free

hand to use Brexit to attack rights and

protections and to cut services, or to

create a tax dodger’s paradise.’

The SNP’s then Westminster Leader,

Angus Robertson, accused the

Prime Minister of breaking her promise

that Article 50 would not be triggered

Theresa May meets with European Council President Donald Tusk in Downing Street

without the agreement of the devolved

administrations. He noted that Scotland

had voted to remain in the EU: ‘On this

issue, it is not a United Kingdom, and

the Prime Minster needs to respect –

respect – the differences across the

nations of the United Kingdom. If she

does not – if she remains intransigent

and if she denies Scotland a choice

on our future – she will make Scottish

independence inevitable.’

The then Lib Dem Leader, Tim Farron,

called for a second referendum on the

terms of the final deal: ‘Today the Prime

Minister is not enacting the will of the

people; she is at best interpreting that

will, and choosing a hard Brexit outside

the single market that was never on the

ballot paper. This day of all days, the

Liberal Democrats will not roll over, as

the official Opposition have done ... I

am determined to be able to look my

children in the eye and say that I did

everything to prevent this calamity that

the Prime Minister has today chosen ...

Surely the Prime Minister will agree with

me that the people should have the

final say.’

The Westminster Leader of the

Northern Ireland DUP, Nigel Dodds,

congratulated Theresa May on

delivering on the will of the people: ‘Is not the fundamental point that this United Kingdom – this Union – is far more important for the political and economic prosperity of all our people than the European Union?’

The veteran Conservative eurosceptic, Sir Bill Cash, hailed what he called an historic day: ‘At the very heart of this letter lies the democratic decision of the referendum of UK voters given to them by a sovereign Act of Parliament by six to one in this House, enabling the British people to regain their birthright to govern themselves for which people fought and died over generations? ... Trade and co-operation, yes; European government, no.’

Another Conservative, Jacob Rees-Mogg, quoted the Elizabethan hero Sir Francis Drake: ‘’There must be a begynnyng of any great matter, but the contenewing unto the end untyll it be thoroughly ffynyshed yeldes the trew glory’ ... I wish my Right Hon. Friend good luck and good fortune in her negotiations until she comes to true glory and is welcomed back to this House as a 21st century Gloriana.’

The former Labour Minister, Pat McFadden, was less optimistic: ‘There are two kinds of future stemming from the process triggered today. The first is that we spend two years desperately trying to secure the exact same benefits as we have, while gaining control of immigration, which, as Ministers have suggested, may make little difference to the numbers. In which case, people will ask, “What is the point?” Or there is another future where we crash without an agreement, defaulting to WTO rules with all that would mean for industry, agriculture and services. In which case, people will ask, “What is the price?” So which future does she think is the more likely: “what is the point” or “what is the price”?’

Negotiations on leaving the EU are expected to take several years to complete


WORK & PENSIONS

align with rules agreed by institutions of which we are no longer a part, just as we do in other overseas markets – we accept that. However, we approach these talks constructively, respectfully and in a spirit of sincere co-operation, for it is in the interests of both the United Kingdom and the European Union that we should use this process to deliver our objectives in a fair and orderly manner. ... We will continue to be reliable partners, willing allies and close friends. We want to continue to buy goods and services from the EU, and sell it ours ... Indeed, in an increasingly unstable world, we must continue to forge the closest possible security co-operation to keep our people safe. We face the same global threats from terrorism and extremism.’

Jeremy Corbyn warned against leaving without a trade agreement: ‘the Prime Minister says that no deal is better than a bad deal, but the reality is that no deal is a bad deal. Less than a year ago, the Treasury estimated that leaving the European Union on World Trade

Organization terms would lead to a

7.5% fall in our GDP and a £45 billion

loss in tax receipts ... It would be a

national failure of historic proportions

if the Prime Minister came back from

Brussels without having secured

protection for jobs and living standards,

so we will use every parliamentary

opportunity to ensure the Government

are held to account at every stage of

the negotiations.’

He said the debate had now moved

on to what a post-Brexit Britain would

be like: ‘There are Conservatives who

want to use Brexit to turn this country

into a low-wage tax haven. Labour is

determined to invest in a high-skill,

high-tech, high-wage future ... Labour

will not give this Government a free

hand to use Brexit to attack rights and

protections and to cut services, or to

create a tax dodger’s paradise.’

The SNP’s then Westminster Leader,

Angus Robertson, accused the

Prime Minister of breaking her promise

that Article 50 would not be triggered

Theresa May meets with European Council President Donald Tusk in Downing Street

without the agreement of the devolved

administrations. He noted that Scotland

had voted to remain in the EU: ‘On this

issue, it is not a United Kingdom, and

the Prime Minster needs to respect –

respect – the differences across the

nations of the United Kingdom. If she

does not – if she remains intransigent

and if she denies Scotland a choice

on our future – she will make Scottish

independence inevitable.’

The then Lib Dem Leader, Tim Farron,

called for a second referendum on the

terms of the final deal: ‘Today the Prime

Minister is not enacting the will of the

people; she is at best interpreting that

will, and choosing a hard Brexit outside

the single market that was never on the

ballot paper. This day of all days, the

Liberal Democrats will not roll over, as

the official Opposition have done ... I

am determined to be able to look my

children in the eye and say that I did

everything to prevent this calamity that

the Prime Minister has today chosen ...

Surely the Prime Minister will agree with

me that the people should have the

final say.’

The Westminster Leader of the

Northern Ireland DUP, Nigel Dodds,

congratulated Theresa May on

delivering on the will of the people: ‘Is not the fundamental point that this United Kingdom – this Union – is far more important for the political and economic prosperity of all our people than the European Union?’

The veteran Conservative eurosceptic, Sir Bill Cash, hailed what he called an historic day: ‘At the very heart of this letter lies the democratic decision of the referendum of UK voters given to them by a sovereign Act of Parliament by six to one in this House, enabling the British people to regain their birthright to govern themselves for which people fought and died over generations? ... Trade and co-operation, yes; European government, no.’

Another Conservative, Jacob Rees-Mogg, quoted the Elizabethan hero Sir Francis Drake: ‘’There must be a begynnyng of any great matter, but the contenewing unto the end untyll it be thoroughly ffynyshed yeldes the trew glory’ ... I wish my Right Hon. Friend good luck and good fortune in her negotiations until she comes to true glory and is welcomed back to this House as a 21st century Gloriana.’

The former Labour Minister, Pat McFadden, was less optimistic: ‘There are two kinds of future stemming from the process triggered today. The first is that we spend two years desperately trying to secure the exact same benefits as we have, while gaining control of immigration, which, as Ministers have suggested, may make little difference to the numbers. In which case, people will ask, “What is the point?” Or there is another future where we crash without an agreement, defaulting to WTO rules with all that would mean for industry, agriculture and services. In which case, people will ask, “What is the price?” So which future does she think is the more likely: “what is the point” or “what is the price”?’

Negotiations on leaving the EU are expected to take several years to complete




On the afternoon of March 22nd, as MPs were engaged in a routine vote of the Pensions Bill, a man drove his car into pedestrians just outside, killing two people and injuring dozens more, before stabbing to death a police officer who was guarding the gates to the Houses of Parliament, and he was then shot dead himself.

The sitting of the Commons was suspended and MPs were held in their Chamber for several hours, before being escorted away. When they returned the next day, they began with a minute of silence. Then the Speaker opened proceedings by expressing ‘our heartfelt condolences to the families and friends of the victims of this outrage. A police officer, PC Keith Palmer, was killed defending us, defending Parliament and defending parliamentary democracy.’

The Prime Minister was heard in silence as she updated MPs: ‘Yesterday, an act of terrorism tried to silence our democracy, but today we meet as normal, as generations have done before us and as future generations will continue to do, to deliver a simple message: we are not afraid, and our resolve will never waver in the face of terrorism. We meet here, in the oldest of all Parliaments, because we know that democracy, and the values that it entails, will always prevail.’

She gave an account of the previous day’s events. ‘A single attacker drove his vehicle at speed into innocent pedestrians who were crossing Westminster Bridge, killing two people and injuring around 40 more. In addition to 12 Britons admitted to hospital, we know that the victims include three French children, two Romanians, four South Koreans, one German, one Pole, one Irish, one

Chinese, one Italian, one American and two Greeks, and we are in close contact with the Governments of the countries of all those affected. The injured also included three police officers who were returning from an event to recognise their bravery; two of those three remain in a serious condition.

The attacker then left the vehicle and approached a police officer at Carriage Gates, attacking that officer with a large knife, before he was shot dead by an armed police officer. Tragically, as the House will know, 48-year-old PC Keith Palmer was killed.’

She ended by declaring that the best response to terrorism was to act normally: ‘As I speak, millions will be boarding trains and aeroplanes to travel to London and to see for themselves the greatest city on Earth. It is in these actions – millions of acts of normality – that we find the best response to terrorism: a response that denies our enemies their victory, that refuses to let them win, that shows we will never give in; a response driven by that same spirit that drove a husband and father to put himself between

The attack on Westminster was one of several terrorist attacks in the UK during the year

A terrorist attack on Parliamentus and our attacker, and to pay the ultimate price; a response that says to the men and women who propagate this hate and evil, ‘You will not defeat us.’ Mr Speaker, let this be the message from this House and this nation today: our values will prevail.’

The Labour Leader, Jeremy Corbyn, said people should not allow the voices of hatred to divide or cower them – adding that PC Keith Palmer had given his life defending the public and democracy.

Watching impassively in the crowd of MPs standing at the Bar of the House, in the area across the Chamber facing the Speaker’s Chair, was the Foreign Office Minister, Tobias Ellwood. He had tried to save PC Palmer’s life by giving him mouth-to-mouth resuscitation. Many MPs took a moment to exchange a word with him as they passed or pat him on the arm. And many of those who spoke over the next hour praised his actions.

Tributes and thanks came from all the

Party Leaders – the SNP’s Westminster

Leader, Angus Robertson, the Liberal

Democrats, Tim Farron, and the DUP’s,

Nigel Dodds.

The Conservative MP, James Cleverly,

had served with PC Palmer in the

army. His voice cracked as he spoke:

‘I would like, with your indulgence,

Mr Speaker, to turn for just a moment

to PC Keith Palmer, whom I first

met 25 years ago, when he was

Gunner Keith Palmer at Headquarters

Battery, 100 Regiment Royal Artillery.

He was a strong, professional public

servant, and it was a delight to meet

him here again only a few months after

being elected. In recognition of the

work that he did, and that the other

police officers and public servants in

the House do, would the Prime Minister

consider posthumously recognising

his gallantry and sacrifice formally?’

Theresa May promised that she would.

PC Keith Palmer, who died trying to stop the attacker, was given a full police service funeral, and praised for his heroism


WORK & PENSIONS

On the afternoon of March 22nd, as MPs were engaged in a routine vote of the Pensions Bill, a man drove his car into pedestrians just outside, killing two people and injuring dozens more, before stabbing to death a police officer who was guarding the gates to the Houses of Parliament, and he was then shot dead himself.

The sitting of the Commons was suspended and MPs were held in their Chamber for several hours, before being escorted away. When they returned the next day, they began with a minute of silence. Then the Speaker opened proceedings by expressing ‘our heartfelt condolences to the families and friends of the victims of this outrage. A police officer, PC Keith Palmer, was killed defending us, defending Parliament and defending parliamentary democracy.’

The Prime Minister was heard in silence as she updated MPs: ‘Yesterday, an act of terrorism tried to silence our democracy, but today we meet as normal, as generations have done before us and as future generations will continue to do, to deliver a simple message: we are not afraid, and our resolve will never waver in the face of terrorism. We meet here, in the oldest of all Parliaments, because we know that democracy, and the values that it entails, will always prevail.’

She gave an account of the previous day’s events. ‘A single attacker drove his vehicle at speed into innocent pedestrians who were crossing Westminster Bridge, killing two people and injuring around 40 more. In addition to 12 Britons admitted to hospital, we know that the victims include three French children, two Romanians, four South Koreans, one German, one Pole, one Irish, one

Chinese, one Italian, one American and two Greeks, and we are in close contact with the Governments of the countries of all those affected. The injured also included three police officers who were returning from an event to recognise their bravery; two of those three remain in a serious condition.

The attacker then left the vehicle and approached a police officer at Carriage Gates, attacking that officer with a large knife, before he was shot dead by an armed police officer. Tragically, as the House will know, 48-year-old PC Keith Palmer was killed.’

She ended by declaring that the best response to terrorism was to act normally: ‘As I speak, millions will be boarding trains and aeroplanes to travel to London and to see for themselves the greatest city on Earth. It is in these actions – millions of acts of normality – that we find the best response to terrorism: a response that denies our enemies their victory, that refuses to let them win, that shows we will never give in; a response driven by that same spirit that drove a husband and father to put himself between

The attack on Westminster was one of several terrorist attacks in the UK during the year

A terrorist attack on Parliamentus and our attacker, and to pay the ultimate price; a response that says to the men and women who propagate this hate and evil, ‘You will not defeat us.’ Mr Speaker, let this be the message from this House and this nation today: our values will prevail.’

The Labour Leader, Jeremy Corbyn, said people should not allow the voices of hatred to divide or cower them – adding that PC Keith Palmer had given his life defending the public and democracy.

Watching impassively in the crowd of MPs standing at the Bar of the House, in the area across the Chamber facing the Speaker’s Chair, was the Foreign Office Minister, Tobias Ellwood. He had tried to save PC Palmer’s life by giving him mouth-to-mouth resuscitation. Many MPs took a moment to exchange a word with him as they passed or pat him on the arm. And many of those who spoke over the next hour praised his actions.

Tributes and thanks came from all the

Party Leaders – the SNP’s Westminster

Leader, Angus Robertson, the Liberal

Democrats, Tim Farron, and the DUP’s,

Nigel Dodds.

The Conservative MP, James Cleverly,

had served with PC Palmer in the

army. His voice cracked as he spoke:

‘I would like, with your indulgence,

Mr Speaker, to turn for just a moment

to PC Keith Palmer, whom I first

met 25 years ago, when he was

Gunner Keith Palmer at Headquarters

Battery, 100 Regiment Royal Artillery.

He was a strong, professional public

servant, and it was a delight to meet

him here again only a few months after

being elected. In recognition of the

work that he did, and that the other

police officers and public servants in

the House do, would the Prime Minister

consider posthumously recognising

his gallantry and sacrifice formally?’

Theresa May promised that she would.

PC Keith Palmer, who died trying to stop the attacker, was given a full police service funeral, and praised for his heroism




President Trump

This year more than most, US

politics had a bearing on our own.

Not only were many MPs looking

across the Atlantic for a trade deal

and an enhancement of the ‘special

relationship’, following the decision

to leave the EU. But the American

people themselves had managed to

outdo the British electorate when it

came to delivering the most surprising

democratic decision of 2016.

As recently as January 2016, a small

number of MPs had gathered in

Westminster Hall to debate whether or

not Donald Trump should be banned

from entering the UK altogether. His

comments about Muslims, among

others, had led to an online petition for

him to be considered a ‘hate preacher’

and therefore banned from British soil.

Even those who supported the motion

knew there was little chance of such a

ban being implemented. But few would

have suspected that, just 13 months

later, Parliament would be discussing

the appropriateness of a state visit from

President Donald Trump.

One of the first acts of the new US

President was to order a blanket ban

on people from a list of Middle Eastern

countries travelling to the US. In the

Commons, the former Labour Leader,

Ed Miliband, and the Conservative,

Nadhim Zahawi, joined forces to ask

the Speaker for an emergency debate –

and it was held that day.

Mr Zahawi, born in Iraq to Kurdish

parents, arrived in the UK as a nine-

year-old refugee from Saddam Hussein’s

regime. He is now a British citizen, but

because he was born in Iraq, he believed

he came under the Trump ban.

He told MPs his place of birth already

meant he had been required to go

through an interview at the US embassy,

to secure the right to travel to America,

under rules imposed by President

Obama. But the new restrictions were

much tougher: ‘I learned that ability to

travel to the United States – a country

that I revere so much for its values, for

which I have such great affinity, affection

and admiration, and to which I have sent

both my sons to university – was to be

denied to me. I learned that this great

nation had put in place measures that

would prevent my family and me from

travelling, studying and feeling welcome

there. I was concerned about the next

time I would see my boys ... my wife

and I despaired at the thought that, had

one of our sons again been taken as

seriously ill as he was last year while at

university, we would not be able to go

to him when he needed us most.’

The US Government has since clarified

that people with British passports

will not be affected by the ban,

whatever the country of their birth,

but Mr Zahawi still thought the ban

was ‘wholly counterproductive’. He

described how it was already being

used by pro-Islamic State social media

accounts as ‘clear evidence that the

USA is seeking to destroy Islam. They

have even called it the “blessed ban”’.

Nadhim Zahawi MP strongly criticised the Trump administration’s travel ban on certain Muslim countries

Ed Miliband said the debate gave the Commons a chance to send President Trump a clear and united view: ‘One of the most chilling things ... was that the accounts of what happened to individuals over the weekend sounded like the results of the actions of a tin-pot dictatorship. They did not sound like what we would expect, or hope for, from the United States ... the United States has always been our oldest and closest ally, and some will say that this is not a matter for us as long as our citizens are protected. I profoundly disagree ... Allowing the measure to stand and shrugging our shoulders will amount to complicity with President Trump ... President Trump is a bully, and the only course of action open to us in relation to his bullying is to stand up and be counted.’

Donald Trump’s mother was born in the constituency of the SNP MP, Angus MacNeil, who said that as a Hebridean he felt ‘utter shame’ at the ban. ‘It is absolutely disgraceful and shameful. I hope he rescinds and changes the measure – not recasts, but rescinds it.’

Labour’s Yvette Cooper, who chairs the Home Affairs Select Committee, was ‘deeply worried’ that the Government had already invited the new President to make a state visit to Britain: ‘it will be not a normal visit by a Head of Government, but a ceremonial state visit involving our royal family ... instead of it being a celebration of friendship and shared values and a sign of increased co-operation ... It will look like an endorsement of a ban that is so morally wrong and that we should be standing against.’

The Conservative, Sir Simon Burns, disagreed: ‘I think it is absolutely right that the British Government continue the work of the Prime Minister to build bridges with President Trump so that we can, through engagement, seek to persuade him and to minimise or reduce the danger of his more outrageous policies ... I believe that very little would be achieved by cancelling a state visit to which the invitation has already been extended and accepted.’

The emergency debate was on a formal motion that MPs had ‘considered’ Donald Trump’s travel ban, so no call for a policy change was voted on.

President Trump meets with Theresa May in Washington D.C. following his surprise electoral victory


WORK & PENSIONS

President Trump

This year more than most, US

politics had a bearing on our own.

Not only were many MPs looking

across the Atlantic for a trade deal

and an enhancement of the ‘special

relationship’, following the decision

to leave the EU. But the American

people themselves had managed to

outdo the British electorate when it

came to delivering the most surprising

democratic decision of 2016.

As recently as January 2016, a small

number of MPs had gathered in

Westminster Hall to debate whether or

not Donald Trump should be banned

from entering the UK altogether. His

comments about Muslims, among

others, had led to an online petition for

him to be considered a ‘hate preacher’

and therefore banned from British soil.

Even those who supported the motion

knew there was little chance of such a

ban being implemented. But few would

have suspected that, just 13 months

later, Parliament would be discussing

the appropriateness of a state visit from

President Donald Trump.

One of the first acts of the new US

President was to order a blanket ban

on people from a list of Middle Eastern

countries travelling to the US. In the

Commons, the former Labour Leader,

Ed Miliband, and the Conservative,

Nadhim Zahawi, joined forces to ask

the Speaker for an emergency debate –

and it was held that day.

Mr Zahawi, born in Iraq to Kurdish

parents, arrived in the UK as a nine-

year-old refugee from Saddam Hussein’s

regime. He is now a British citizen, but

because he was born in Iraq, he believed

he came under the Trump ban.

He told MPs his place of birth already

meant he had been required to go

through an interview at the US embassy,

to secure the right to travel to America,

under rules imposed by President

Obama. But the new restrictions were

much tougher: ‘I learned that ability to

travel to the United States – a country

that I revere so much for its values, for

which I have such great affinity, affection

and admiration, and to which I have sent

both my sons to university – was to be

denied to me. I learned that this great

nation had put in place measures that

would prevent my family and me from

travelling, studying and feeling welcome

there. I was concerned about the next

time I would see my boys ... my wife

and I despaired at the thought that, had

one of our sons again been taken as

seriously ill as he was last year while at

university, we would not be able to go

to him when he needed us most.’

The US Government has since clarified

that people with British passports

will not be affected by the ban,

whatever the country of their birth,

but Mr Zahawi still thought the ban

was ‘wholly counterproductive’. He

described how it was already being

used by pro-Islamic State social media

accounts as ‘clear evidence that the

USA is seeking to destroy Islam. They

have even called it the “blessed ban”’.

Nadhim Zahawi MP strongly criticised the Trump administration’s travel ban on certain Muslim countries

Ed Miliband said the debate gave the Commons a chance to send President Trump a clear and united view: ‘One of the most chilling things ... was that the accounts of what happened to individuals over the weekend sounded like the results of the actions of a tin-pot dictatorship. They did not sound like what we would expect, or hope for, from the United States ... the United States has always been our oldest and closest ally, and some will say that this is not a matter for us as long as our citizens are protected. I profoundly disagree ... Allowing the measure to stand and shrugging our shoulders will amount to complicity with President Trump ... President Trump is a bully, and the only course of action open to us in relation to his bullying is to stand up and be counted.’

Donald Trump’s mother was born in the constituency of the SNP MP, Angus MacNeil, who said that as a Hebridean he felt ‘utter shame’ at the ban. ‘It is absolutely disgraceful and shameful. I hope he rescinds and changes the measure – not recasts, but rescinds it.’

Labour’s Yvette Cooper, who chairs the Home Affairs Select Committee, was ‘deeply worried’ that the Government had already invited the new President to make a state visit to Britain: ‘it will be not a normal visit by a Head of Government, but a ceremonial state visit involving our royal family ... instead of it being a celebration of friendship and shared values and a sign of increased co-operation ... It will look like an endorsement of a ban that is so morally wrong and that we should be standing against.’

The Conservative, Sir Simon Burns, disagreed: ‘I think it is absolutely right that the British Government continue the work of the Prime Minister to build bridges with President Trump so that we can, through engagement, seek to persuade him and to minimise or reduce the danger of his more outrageous policies ... I believe that very little would be achieved by cancelling a state visit to which the invitation has already been extended and accepted.’

The emergency debate was on a formal motion that MPs had ‘considered’ Donald Trump’s travel ban, so no call for a policy change was voted on.

President Trump meets with Theresa May in Washington D.C. following his surprise electoral victory

2016 / 2017 · PDF fileAquila Heywood Chantler Kent ... fairer society – where people...

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Transcript of 2016 / 2017 · PDF fileAquila Heywood Chantler Kent ... fairer society – where people...