'Robo-advice' approved by FCA but axes 220 jobs at RBS

So-called "robo-advice" has resulted in hundreds of job cuts at Royal Bank of Scotland (RBS), just as the regulator gave its blessing to the technology.

RBS is cutting the jobs of 220 face-to-face advisers, as it switches customers to an automated online service.

It said personalised advice would now only be offered to customers with more than £250,000 to invest.

However, the Financial Conduct Authority (FCA) said such services could make financial advice cheaper.

Cosatu threat delays vote on direct retirement savings.

 

Threats and political pressure have prompted Parliament’s standing committee on finance to delay a vote on a Treasury proposal to restrict direct access to retirement savings.

Pensioners face threat to retirement income after calls to slash Pension Payouts

An authoritative think-tank report called for the abolition of the so-called “triple lock’ which guarantees rises. 

PENSION

The lock means state pensions go up by either inflation, earnings growth or 2.5 per cent, whichever is the highest. 
But it is costing taxpayers £6billion a year and “needs to end”, said the Institute for Fiscal Studies.

The constant increases will “at some point become prohibitively expensive”, the institute warned. 
The guarantee has helped make today’s pensioners better off than any previous generation, with average incomes for the first time higher than those of people in work. 

Pension Transitional Arrangement Directorate, discovers 600 unpaid Pensioners after Verification Exercise

Custom, other retirees express satisfaction

The Pension Transitional Arrangement Directorate (PTAD) has, after its verification exercise for retired Police officials, discovered 600 pensioners that had never received any payment since retirement.

Nellie Mayshak, director-general of PTAD, who disclosed this to journalists in Lagos, described the development as unjust.

PTAD

Consequently, the Directorate promised that these retirees were going to be paid all their money immediately.

“On the good side, there were 600 pensioners that had never received any payment since they retired, which is unjust. So, we are quickly going to pay those people. Through the process, we have seen that some people are underpaid while some are overpaid, and so we are adjusting all that,” she said.

Presently, the verification exercise for Customs, Immigration and Prisons pensioners is ongoing. The exercise is being carried out in 13 centres across the country – Rivers, Edo, Cross River, Enugu, Imo, Lagos, Oyo, Kano, Sokoto, Bauchi, FCT, Kwara, and Benue.

Stakeholders want New Pension Scheme reviewed, Better Managed

Stakeholders have called for a review of the Contributory Pension Scheme, operated under the Pension Reform Act 2004 to make it more beneficial for subscribers.

While workers and pensioners want the scheme scrapped and a return to the old scheme, the mangers and labour leaders say it is more beneficial but needs to be better managed.

Some of the workers called for a return to the old system funded through the treasury.

Retirees and workers said pension benefits in the contributory scheme were meagre and never guaranteed happy old age.

 

A retiree from Jigawa, Malam Usman Abubakar, described the contributory pension scheme as a ‘fraud’.

He said that under the new dispensation, workers were expected to contribute 7.5 per cent of their emoluments with equal contribution by the employer.

“Unfortunately after retirement, the lump sum is divided into three and the retiree goes home with only a portion of his contributions.

“Your Pension Fund Administrator (PFA) will tell you that the remaining part of the money will be kept for you to be servicing your monthly pension, while the rest will be invested in a business that no one knows,” he said

Pensioners to Sell Back their Annuity Must not be Rushed, Insurers say

The government wants to extend the pension overhaul to allow pensioners to sell back their annuity - a fixed retirement income - to providers.

But a trade body says the proposed April 2016 start date puts people at risk of scams.

Wait to be sacked if you want to access part pensions

Olajumoke, age 44, worked in one of the medium-sized deposit money banks in Lagos, as a senior manager before he resigned late last year following a major restructuring that affected more than 40 percent of the staff in his bank.

When the restructuring got to Olajumoke’s department, the treasury, he was asked to resign by himself, but thinking it would mean a disgraceful exit to request sacking, he resigned by himself and left for his house. The bank, however, has since paid him his terminal benefit even though that has not been enough to carry him for long because he had not secured another job since then.

Safeguards under the Contributory Pension Scheme

There are still many skeptics when it comes to embracing the Pension Reform Act and the Contributory Pension Scheme (CPS) in Nigeria. While the regulators – National Pension Commission (PenCom) and the operators – Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs) have done very well in birthing the new scheme and operating it efficiently and effectively, a number of potential contributors and some employees have concerns about the efficacy of the scheme relying on their past experiences with pension schemes and other government sponsored initiatives. To allay their fears and concerns, it is useful to discuss some of the safeguards inherent in the CPS in Nigeria.

Separation of Custody from Administration

One of the major risks associated with pension schemes is co-mingling of funds whereby pension assets are managed within the same pool of resources as other funds belonging to the organization (sponsor) or the fund manager or even other non-pension clients. In Nigeria prior to the PRA 2004 and its successor PRA 2014, virement of pension funds occurred wherein organizations used pension funds to settle other liabilities, obligations and operational expenses with the hope that such funds will be returned. In many cases the funds were not returned, and pensioners suffered. In other cases, fund managers and insurance companies did not separate pension funds from other funds that they managed and where investment losses occurred, pension funds suffered.

Under this new scheme pension assets are completely separated from the organizations in the first instance, and there is also a separation of the responsibilities of pension fund management and payment (PFA) and pension fund custody (PFC) with strict guidelines about the conduct and relationship between these entities that protect the pension funds and the retirement benefits ultimately. Also, where PFAs or PFCs may be mismanaged and fail, the separation of custody and management and the prudent investment guidelines that we will discuss shortly sterilize your pension funds and protect them from distress. If and when PFAs or PFCs are distressed, PenCom will take over the sterilized assets and account information and transfer to another licensed and sound PFA and/or PFC.