Advisers exploit new platform tech to improve client service and cut costs – Friday IFA news round-up, the week’s news in a nutshell…

by | Oct 27, 2017

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Here’s your Friday IFA news round-up, what you need to know from the industry and the investment communities that’s happened this week. Read this when you have a few minutes to spare and you’ll be up to speed on almost everything.

New platform tech exploited by advisers

Over a third of advisers expect to direct more business to platforms over the next 12 months, with overall assets on platforms expected to surpass £1.2tn by 2021.


What’s more, 86% of advisers find that platform technology makes providing advice more cost effective. And, convenience and a wide range of investment choices is seen as particularly beneficial to clients.

These are the main conclusions of Aegon’s new Adviser Attitudes Report: Technology in the Financial Advice Market. The report can be read here:

FINAL AAA Technology in the financial advice market


It states that the platform sector is seeing significant growth with total assets under administration increasing by 6% in the first quarter of 2017 to £520bn. By 2021 it is expected to surpass £1.2tn.

Other report conclusions:

  • 66% of advisers say greater convenience and time efficiency that platforms offer clients is main reason they are beneficial;
  • 63% point to value to clients of wide range of investments available;
  • other key benefits for clients include lower charges (39%), making financial planning more straightforward (36%), and speed that client requests are able to be processed (34%);
  • 86% advisers find platform technology makes process of providing advice more cost effective;
  • 82% believe it makes the process more straightforward;
  • 57% of advisers see cost efficiencies that they can pass on to clients as being greatest benefit of the technology;
  • 24% see it as a suitable option for all clients;
  • 65% would judge it on a case by case basis;
  • 63% said top reasons for using a platform over a traditional life company are access they give to better investment choice (fund options and access to Discretionary Fund Managers) and 58% because it helps manage a range of products and investments in one easy-to-use portal.

Sanlam completes Tavistock deal


Sanlam UK – part of Sanlam Limited, the global financial services group – completed the acquisition of the financial adviser network of Tavistock Financial Ltd from Tavistock Investments Plc, following the FCA’s approval of the change of control application.

Record levels of capital gains tax paid – latest HMRC stats 

  • Record number of people paying capital gains tax (CGT) – 239,000 individuals paid £7.740 billion in 2015/16
  • Record amount of CGT paid – £8.347 billion – 20% rise from previous year
  • Average CGT rate paid 17% (after reliefs and allowances)

Source: HMRC 2015/16 provisional figures 


Capital gains tax stats are out, you can find them here:

In the tax family, the perception is that few people pay CGT but this is not correct. CGT receipts continue to climb, and HMRC receives much more in CGT than it does in IHT. CGT was cut in April 2016, but not for second properties and buy to let.

Danny Cox, Chartered Financial Planner, Hargreaves Lansdown, said: “Record numbers of payers and receipts show capital gains tax is making an average 17% dent in investor’s profits.  The best way to avoid CGT is to shelter your investments from tax from outset using ISA or SIPP. CGT may not be a consideration when you first start investing, however the more you invest and the longer you invest for, the greater the problem tax on your gains will become. Tax influences investment decisions and investors are often reluctant to take profits from holdings which are heavy with gains. All the more reason to shelter shares and funds in ISA so your portfolio is tax worry free.”


Pension schemes compelled to bullish fees

In line with news from the Department for Work and Pensions that pension schemes will for the first time be compelled to publish the fees they charge their members for investing their pension, under proposals announced today Pat Sharman, UK Managing Director for KAS BANK, commented: “The government is pushing for greater transparency in the pension sector, and this proposal for greater disclosure of charges for DC pension scheme members is a very welcome step in the right direction. By giving members a better understanding of costs associated with their scheme both members and trustees will be able to compare value for money and ultimately make more informed investment decisions.

“The drive for better cost transparency across the pension industry is becoming increasingly more important. At KAS BANK, we created the UK’s first cost transparency dashboard for trustees earlier this year, which provides clear investment and scheme management cost analysis, to help more informed decision making and possible better outcomes for members. Whilst there is certainly more work to be done to ensure better transparency and cost disclosure, this is an encouraging step in the right direction.”


Association of Consulting Actuaries report comment

On the Association of Consulting Actuaries report, Peter Bradshaw, National Accounts Director, Selectapension, comments: “It’s no surprise to read demand for DB transfers is far greater than the supply of advice to support them. It is a surprise, however, that it’s taken so long for the ACA to report this. There are templates in existence to illicit scheme details for use by advice firms, but they are rarely completed by scheme administrators.  There are very few standardised benefits for any particular individual scheme member, so standardised questions probably won’t help. To improve on the time taken to gather information for individuals, full scheme information could be published centrally on a site. Both financial advice firms and scheme administrators need a better understanding of each other’s requirements and resources.”

LGIM launches Real Capital Builder

Legal & General Investment Management has launched the L&G Real Capital Builder (RCB) fund for external investors. RCB is an equity-led outcome oriented unit trust that aims to generate total returns of 4% above inflation per annum over a rolling five year period at two-thirds of the risk of an equity index. The strategy meets investor demand for a risk managed fund that aims to deliver consistent returns ahead of inflation.

Latest pensions figures from HMRC

HMRC have released latest details on flexible payments from pensions (available here).


  • 198,000 people took payments totalling £1,590 million in Q3 2017
  • An increase from 158,000 people taking £1,540 million in the same period last year.
  • So far this tax year we have seen £3,450 million in flexible pension payments, this is up on the £3,310 million withdrawn in the first 6 months of the 2016/17 tax year.

Note: The 2015/16 tax year figures whilst reported are not an accurate comparison since providing this data was not mandatory until the 2016/17 tax year. 

Nathan Long, Senior Pension Analyst at Hargreaves Lansdown, said: “Keeping your pension invested whilst drawing either lump sums or a regular income continues to grow in popularity, so it is no surprise that the value and number of people taking flexible payments has increased. This will be a boost to the Treasury and bizarrely may stave off any further tinkering to pension allowances and reliefs in the forthcoming Budget. This further evidence will surely feed into the Pension Select Committee’s enquiry into the success of pension freedoms. On the one hand pensions have never been more popular as retirees’ craving for control is met, on the other it is no good watching your money run out prematurely, albeit whilst being the master of your own destiny.

“The period following the pension freedoms has been one of rampant stock market returns, so many investors new to drawdown may never have fully experienced a drop in the value of their investments. For most people, having sufficient guaranteed income to cover the retirement essentials will be a sensible choice. State and final salary pensions are the obvious sources of secure income, but annuities are a useful top up. Annuity rates remain suppressed due to the prevailing low interest rates, yet have leapt by 16% since last September. You now get more for your money than a year ago, meaning now could be a great time to revisit your long term retirement plans.”

Gross mortgage lending up

Gross mortgage lending figures are 5% higher than a year ago, but slightly down from August’s figures at £21.4bn. John Goodall, CEO & co-founder of buy-to-let specialist Landbay, said: “Mortgage lending activity dipped slightly in September but remains significantly up on last year’s levels as borrowers continue to take advantage of record low interest rates and loan-to-value deals. These more accommodating borrowing conditions are however set to change in the coming months as the prospect of the first interest rate rise in almost a decade looms large, putting pressure on borrowers, and potentially putting off first time buyers.

“September’s figures also offer some insight into the final month of lending before the PRA’s portfolio landlord changes came into effect. While these new regulations are a good thing for the sustainability of the buy to let sector, we may see a dip in lending in the coming months as the sector adjusts to both the new regulations and a possible rate change.”

Tilney appoints Tompson to London office

UK investment management group Tilney has appointed Andrew Tompson to its London office. He joins the company as a Business Development Manager with a region focused from London to the South Coast. Tompson moves from Turpin Baker Armstrong, where he was a qualified independent financial adviser as well as taking on a role of business development.  There he was responsible for developing and maintaining relationships with business introducers such as accountants and solicitors, arranging meetings and advising potential new clients, as well as advising and servicing existing HNW clients within his role as a financial planner. At Tilney, he will continue to support their expanding professional referrer network of IFAs, Lawyers and Accountants of the Tilney for Professionals business, as well as working with the trustee community, US professionals and investment consultants.

City of London lobbies Chancellor

The City of London Corporation recently submitted a letter to the Chancellor of the Exchequer ahead of the Budget on 22 November. The Corporation is calling for:

  • effective bridging and adaptation periods so businesses can prepare for transition after Brexit in March 2019;
  • transition, trade and talent at the heart of delivering a smooth and orderly Brexit;
  • the lowering of tax rates for corporate treasury centres to make the UK competitive and attract additional corporate treasury centres from Asia and elsewhere;
  • certainty and stability for businesses over tax changes. The setting of parameters for future tax changes, their simplification and their evolution, will aid business investment and location decisions;
  • a further round of devolution for London government, particularly in terms of education, skills and employability;
  • a new a bespoke London Commission to look at the much longer term infrastructure needs of the capital.

Late workplace pension companies

Newly released data from Aviva shows that a record proportion of companies are setting up their workplace pension after their deadline – known as a staging date – has passed. The figures for July, August and September this year show that 25% of businesses applying for their workplace pension with Aviva did so after the date set for them by the Government watchdog, the Pension Regulator (tPR). Businesses that miss their staging date put themselves at risk of a fine and limit their options for a pension scheme because not all providers will accept ‘late stagers’.

State Bank of India joins Connect for Intermediaries

State Bank of India has joined the Connect for Intermediaries network panel, which has already welcomed Octane, West One and Funding Circle since the beginning of the year. State Bank of India has operated in the UK for over 95 years.  It offers a range of residential buy-to-let and commercial lending products to UK intermediaries. The bank has more than 400 million customers worldwide and offices in 38 countries, making it India’s largest bank.

Advisers divided over concerns around DB transfer market

Financial advisers are divided over their concerns around the DB transfer market, according to a poll conducted by Russell Investments. When asked to identify their biggest concern in relation to the DB transfer market, advisers were equally split around the responsibility on providers if a transfer proves not to be the right option (25%); not having enough time or the right tools to deal with the number of transfer enquiries (25%); and. not having the qualifications to advise on DB transfers (25%).

Three ‘Made Simple Guides’ from PLSA

Three new Made Simple Guides on Fiduciary Management (written and sponsored by Schroders), Good Quality Data for the Private Sector (written and sponsored by Equiniti) and Integrated Risk Management (written and sponsored by Cardano and Lincoln Pensions) have been published by the Pensions and Lifetime Savings Association (PLSA), adding to its library of essential resources for the pensions sector. The free guides are designed to help pension funds and others in the pensions industry get to grips with technical topics – minus the jargon.

Fidelity expands Smart Beta ETF range

Fidelity International is expanding its Smart Beta ETF range with two new quality income-focused funds, offering investors an income solution with a full suite of regional exposures.

The Fidelity Europe Quality Income UCITS ETF and the Fidelity Emerging Markets Quality Income UCITS ETF seek to provide exposure to high quality dividend paying companies. The strategy builds a portfolio of stocks which have historically demonstrated good profitability, strong cashflows and consistent dividends with the objective of delivering a yield in excess of the broader market* whilst, at the same time, carefully managing risk.

F&C UK Property Fund invests £60 million

BMO Real Estate Partners, the pan-European property investment and asset management specialist, part of Canada’s BMO Financial Group’s £189 billion Global Asset Management business, has invested £60 million across nine properties on behalf of the F&C UK Property Fund, reflecting an initial yield of 4.8%. In the last 12 months, a total of £100 million has been raised and invested into the open-ended Fund’s portfolio, increasing its total value by a third to £416 million.

New Red Ribbon funds

Red Ribbon Asset Management, a London-based firm specialising in Mainstream Impact Investments, announced the launch of the Red Ribbon Private Equity Fund and the Red Ribbon Real Estate Fund. Each of which will meet growing investor demand for long-term, socially responsible investments in emerging and growth markets, and India in particular.

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