A row has broken out over a cross-party amendment to the Pensions Bill, with independent policy adviser Dr Ros Altmann accusing the ABI of misleading MPs and the press.
The ABI has urged MPs to vote against an amendment, already passed in the House of Lords, which will allow unclaimed assets to be transferred to the Lifeboat Fund, set up to help people whose pension schemes had collapsed.
The trade body has warned the amendment will allow the Financial Assistance Scheme (FAS) to take money out of pension funds and with-profits policies to supplement the FAS.
However, Altmann says the ABI is scaremongering and the current amendment merely allows the Government to review potential funds that may be used to support the FAS.
Altmann says: “The House of Commons explanation of what the amendments will do explains the Government is merely asked: 'to obtain information about unclaimed assets, to provide this information to the Secretary of State and to administer a scheme to transfer unclaimed assets to the Lifeboat Fund’.
“The specifics about the information to be obtained and provided and the classes of unclaimed assets to which the requirement will apply would be prescribed in regulations.”
Altmann has accused the insurance industry of attempting to deny access to large pots of unclaimed cash which they currently possess.
She adds: “The insurance companies are so frightened of even being asked to identify what unclaimed assets they hold, that they are using false arguments to interfere with the Parliamentary process.”
The ABI has denied it is misleading MPs and says that more clarity is needed regarding which assets can be claimed by the Lifeboat Fund before the Pensions Bill leaves parliament.
A spokesman for the ABI says: “We particularly maintain the view that life and pensions and inherited estates should not form any part of this amendment.”
The ABI has also welcomed the publication of the Young Review’s interim report into the assets of the FAS scheme.
The review found that income from unclaimed life and pensions policies is uncertain and difficulties in obtaining such assets are substantial.
Commenting on the findings of the review, Stephen Haddrill, director general of the ABI, says: “The ABI opposed the ‘lifeboat fund’ amendment to the Pensions Bill and continues to do so. The debates around it, and Andrew Young’s reports, have now shown a better way forward, and the amendment can be withdrawn.”
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Have your say:
"Dr Ros Altmann appears to have forgotten that the assets of pension schemes are set aside for the benefit of the members, held in trust by the trustees, who legally own them, until they are required to purchase benefits for the members.
The Government cannot get their hands on them.
With trustees in charge, and with the Pensions Registry, there are no ' unclaimed assets'." Colston Hicks
"Dr Ros Altman is absolutely right regarding the ABI's latest attempt to mislead Parliament. The fiscal power of the ABI's members should not be allowed to corrupt the due diligence that MPs are obliged to apply to their appraisal of the pension and insurance markets.
Consumer satisfaction and working with professional advisers should be the objectives of the ABI in order to secure both greater respect and indeed subsequently greater profits for its members.
Unfortunately, the current senior management of the ABI and the industry are seeking big short-term profit-making methods which will not stand the tests of time.
By ignoring the good progress and status of the UK financial services industry and the progressive improvements that evolution provides, both the ABI and MPs have alowed Gordon Brown to catastrophically interefere with pension funds - as Alastair Darling is certain to carry on doing with his similarly extreme left wing idealism - vandalising decades of progress.
Is there anyone up there with true, honest, ubiased, impartial integrity - you know - just what IFAs stand for?" Michael Forbes Bates, IFA
"On this occasion I am right behind the ABI. Any move by government and other agencies to access cash that is not their’s should be robustly resisted. One wonders to what depths these people will go to get their hands on other people’s cash. Unclaimed funds are not for doling out to any cause however worthy it may appear." Adrian Ford, IFAIFAonline
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