FSA consults on reducing projection rates

The Financial Services Authority (FSA) is consulting on reducing projection rates across both personal and corporate pensions so they can be compared on a like-for-like basis.

Working with the Financial Reporting Council, it said consistency across different types of pensions was needed so projection rates could be compared. The proposal is part of a wider consultation on reducing projection rates across tax-advantaged products, like personal pensions, and tax-disadvantaged products such as endowment policies and investment bonds. Its three proposed rates for products including personal pensions are 2%, 5% and 8%. The current rates are 5%, 7% and 9%. The proposed rates for tax-disadvantaged products are 1.5%, 4.5% and 7.5%, significantly lower than the e...