Looking to the future

New prime minister David Cameron said in May that the UK’s first coalition in decades marks an “historic and seismic shift” in British politics. Of course, it is far too early to ascertain the validity of such a claim, but the government’s inaugural budget has certainly given some indication of the direction in which the nation is set to travel.

The UK’s financial woes have been well-documented and speculation was rife ahead of June’s emergency budget as to how the country’s new leaders would tackle the national debt. They have now shown their hand, with public spending cuts proving to be the trump card. Widespread cutbacks will save the government a lot of money, but at what cost?

Our cover story this month looks at the impact of the budget on the elderly. How are pensions affected? Will there be a downturn in the standard of social care? What will be the effect on trusts of the rise in capital gains tax? See "Tightening the belt" feature to find out.

Also this month, we talk to the Society of Trust and Estate Practitioners’ chairman Michael Young. With a membership of almost 6,000 in the UK alone, STEP is arguably the single most important professional organisation for raising issues related to the responsible stewardship of assets today and across the generations. Young gives an insight into the workings of the association, considering its past achievements and setting out its aims for the future.

And in keeping with that theme, it is with great pleasure that I bring to you exciting news about the future of Elderly Client Adviser. Autumn will mark a new phase in the history of the magazine, when we re-launch as Private Client Adviser, bringing you more features, interviews and insights into on a wider range of issues relevant to professionals operating in the private client sector. We’ll be bigger, brighter, more frequent, and with a brand new website regularly updated with fresh content between each issue.

Whether this change will represent an “historic and seismic shift” only time will tell, but we are confident that it is a positive step and hope that you will too.

Kathryn Young

Editor

Features

The state we’re in This article is for subscribers only
It’s the biggest pension plan in the country, we are all members, but how many of us can say confidently that we know what we are entitled to? I am of course talking about the state pension. It’s often overlooked. But it’s a benefit everyone should take a little more notice of.

Writing it out This article is for subscribers only
Protecting the estate from a subsequent attack by a disgruntled beneficiary, or would-be beneficiary, is now raised more frequently as a planning issue at the will drafting stage. The issue arises because post-death claims against estates expose them to a significant depletion of funds, which affects the value of the residuary beneficiaries’ interests. This is caused by both the value of the claim itself and the executors’ and, quite possibly, the parties’ legal costs. It is not unusual to see costs on each side reach six figures.

Tightening the belt Free
The dust has now settled on the coalition government’s first budget. Delivered on 22 June by chancellor George Osborne, the general consensus seems to be that the budget was much as expected and, perhaps even, not quite as bad as some feared.
Widely tipped tax hikes did not come to fruition, with instead the emphasis on public spending cuts as a means of reducing the deficit. The rise in VAT from January 2011 to 20 per cent is arguably the most far-reaching change, and the likely increase in state pension age to 66 from 2016 has proved one of the more controversial revisions.
But what does the budget actually mean in real terms? We canvass opinion on the reforms from industry experts across a range of sectors to find out what they think is the true impact of the budget on the elderly client.

The fairer sex? Free
Many independent financial advisers have for many years had a strong female representation among their senior consultants, but this has been as a result of chance, rather than a deliberate master plan. There is absolutely no evidence that female advisers are any better, or worse, than their male counterparts. However, it would appear that recently an increasing number of firms believe that their female employees can be a considerable attraction to potential clients and are seeking to capitalise on this fact.

A STEP in the right direction This article is for subscribers only
The Society of Trust and Estate Practitioners’ chairman Michael Young talks to Kathryn Young about the current trusts’ landscape and its future prospects
STEP aims to promote the highest professional standards through education and training and works to demonstrate the value of good stewardship and planning across future generations to governments, professionals, financial institutions and the public. The society has a network of national and regional branches that helps it achieve its goals. In the UK, becoming a member involves a demonstration of knowledge and competence, the most popular option being the STEP England & Wales Diploma. STEP also actively promotes continuing professional development among its members through briefings, publications, special interest groups, courses and seminars.

Due care and attention This article is for subscribers only
The coalition Welsh assembly government stated in its “One Wales” programme that during its term it would bring forward legislation to create a more level playing field in relation to charges for domiciliary care services. It has fulfilled that commitment in passing the Social Care Charges (Wales) Measure 2010, which received Royal Assent on 17 March 2010.
In Wales, this measure will replace the Westminster-enacted Health and Social Services and Social Security Adjudications Act 1983, which gave local authorities the power to recover such charges they considered reasonable from recipients of non-residential social care services.