In this edition of The Briefing from Informed Choice on Thursday 5th April 2018 – value for money rules, gender pay deadline, mobile data auction, digitally signed mortgage, and work until you drop.
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Value for money rules
The Financial Conduct Authority (FCA) has ruled that asset managers must assess each year how much value for money they offer to investors. The regulator stopped short of introducing tougher measures as part of its long-awaited asset management study. It has given asset managers 18 months to prepare for the new rule, being introduced in September 2019, which requires an annual assessment of value for money. Asset managers will also have to appoint at least two independent directors to their boards.
Christopher Woolard, the FCA’s executive director of strategy and competition, said:
Today’s announcements are an important part of a package of measures that, combined, aim to achieve a fair, transparent, open and accountable market.
Gender pay deadline
With the deadline expired for large firms to disclose their gender pay gaps, it has been revealed that more than three-quarters of UK companies pay men more on average than women. More than 10,000 employers with more than 250 staff have published their data, with a median pay gap of 9.7%. 78% of firms which reported paid men more than they paid women, with 14% paying women more than men. 8% of firms reported no gender pay gap.
Rebecca Hilsenrath, chief executive of the Equality and Human Rights Commission (EHRC), told the BBC:
We’re looking at approximately 1,500 companies which haven’t reported. We’re obviously pleased with the rate of reporting, but it is the law, it’s not an option. It is the right thing to do, and we will be enforcing against all those organisations which failed to meet the deadline.
Mobile data auction
The UK’s largest telecoms firms have spent more than £1.3bn on the first stage of bidding for new 4G and 5G licences. EE, Three, O2 and Vodafone bid a total of £1.35bn in the spectrum auction with regulator Ofcom, with proceeds going to the Treasury. In the first stage of the auction, 34 lots of spectrum were made available across the two data bands which were previously used by the Ministry of Defence.
The next step in the auction process, the assignment stage, will allow the winning bidders to bid for where in the frequency bands their new spectrum will sit. Ofcom will then issue the licences allowing the firms to use their spectrum.
Philip Marnick, Ofcom’s spectrum group director, said:
This is good news for everyone who uses their mobile phone to access the internet. As a nation we’re using ever more mobile data on smartphones and mobile devices. Releasing these airwaves will make it quicker and easier to get online on the move. It will also allow companies to prepare for 5G mobile, paving the way for a range of smart, connected devices.
Digitally signed mortgage
The first digitally signed mortgage deed has been lodged for a house in Rotherhithe, London. Part of the ‘Sign your mortgage deed’ service, HM Land Registry is building for a future without the need for a witness to watch as the homeowner applies an ink signature to a paper mortgage deed, saving time and providing a more secure service to homeowners, lenders and conveyancers.
The registration forms part of HM Land Registry’s plans to transform the conveyancing market through quicker and simpler digital services and improved use of technology, making transactions instantaneous where possible and simplifying the homebuying process. The registration of the deed follows months of collaboration and testing with Coventry Building Society and Enact Conveyancing and uses GOV.UK Verify to enable borrowers to securely verify their identity before digitally signing their mortgage deed online.
HM Land Registry Chief Executive and Chief Land Registrar Graham Farrant said:
By working with partners in the industry, we have secured a simpler and faster service for the benefit of home owners. We are looking forward to rolling this out nationally and will be working with more conveyancers and lenders to do so.
Work until you drop
With the first increase in minimum automatic enrolment workplace pension contributions coming into force tomorrow, new research shows one in five Brits say they will keep working until are physically unable to do so. The research from Scottish Widows shows an additional three million people expect to work until they die.
The increase in AE workplace pension contributions is designed to help narrow the retirement savings gap, but there are many who need to be doing more to ensure a comfortable retirement. Scottish Widows’ research shows that 44% of people are not saving its recommended 12% of their salary towards retirement each year, which is more than double the new minimum AE contribution level of 5%.
Robert Cochran, Retirement Expert at Scottish Widows, said:
While the idea of a ‘cliff edge’ retirement – when people around the age of 60 to 65 give up work once and for all – has been disappearing in recent years, our research clearly shows this is a necessity rather than a choice for too many workers.
Auto-enrolment has been a great success in kick-starting the savings habit for millions, and the increase in minimum contributions from this month should, in the long-term, mean that more people have valuable pension funds to live off as they approach later life. With life expectancy expected to continue rising, it’s worthwhile remembering that saving for the future doesn’t need to stop at ‘retirement age’. Only a third of people who expect to carry on working past retirement age think they will continue to pay into a pension – over time this number is likely to go up.
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