Tag: Treasury

The press release issued by HM Treasury on 11 April 2001.

Following a Whitehall-wide competition, Nicholas Macpherson will be promoted to Managing Director of the Treasury’s Public Services Directorate from 23 April.

In addition, following John Gieve’s move to Permanent Secretary at the Home Office, Jon Cunliffe will be promoted to Managing Director of the Treasury’s Financial Regulation and Industry Directorate from the same date.

NOTES FOR EDITORS

Nicholas Macpherson, aged 41, joined the Treasury in 1985 after working as an economist at the CBI and Peat Marwick. He has held various posts, working on social security, tax policy, public expenditure control and economic and monetary union.  In the mid-1990s, he was Principal Private Secretary to Kenneth Clarke and Gordon Brown.  He subsequently worked on the Taylor review of the tax and benefit system, and over the last three years has been the director of welfare reform, leading Treasury work on tax and benefit reform, child poverty and employment issues.  He chaired the review of welfare to work spending in the 2000 spending review.

The Public Services Directorate’s main objective is to improve the quality and cost effectiveness of public services.

Jon Cunliffe, aged 47, has spent the last three years leading  Treasury work on the international financial system, its institutions (IMF, World Bank etc), the G7 summit and non-EU economies.  Previous jobs in the Treasury have included leading the Treasury’s work on operational independence of the Bank of England and on European Monetary Union, management of the Government’s debt and foreign currency reserves, UK Alternate Director at the European Bank for Reconstruction and Development and Public Sector Pay.  Jon joined the civil service in 1980.  He spent the early part of his career in the Departments of Environment and Transport, where he served as Private Secretary to three Secretaries of State for Transport.

The Financial Regulation and Industry Directorate’s main objectives are:

• Increasing the productivity of the economy and expanding economic and employment opportunities for all, through productive investment, competition, innovation, enterprise, better regulation and increased employability; and

• Securing an efficient market in financial services and banking with fair and effective supervision.

The press release issued by HM Treasury on 26 April 2001.

A consultation on two new saving and asset proposals – the Saving Gateway and the Child Trust Fund – to tackle child poverty, break the cycle of disadvantage and open savings and wealth ownership to all was launched by the Government today.

Speaking at a press conference in Downing Street, the Prime Minister, Chancellor Gordon Brown, Education Secretary David Blunkett and Social Security Secretary Alistair Darling set out Government proposals to give all children a running start in life and help lower-income earners plan for their future and retirement.

Saving and Assets for All sets out plans for:

• The Saving Gateway, which will provide lower-income earners incentives to save by offering to match savings with additional contributions paid by the Government.
• The Child Trust Fund, which will provide a cash lump sum to all children at birth, to be kept in special accounts until they reach adulthood, thus offering access to the opportunities that asset-ownership brings. The scheme will also offer parents, relatives and children themselves the opportunity to make additional contributions to the Child Trust Fund.

Prime Minister Tony Blair said:

“We are committed to extending opportunity to all. All our children – especially the most disadvantaged – should have the chance of a proper start in life. Getting people into the savings habit, and making sure children have a real financial springboard, is a vital part of that. Piece by piece, we are dismantling the barriers – no matter what they are – which hold people back.”

Chancellor Gordon Brown said:

“Our aim is the abolition of child poverty in a generation – and to open saving and wealth ownership to all. And to do that, we plan not only to improve the weekly incomes on which a child is reared but to make it possible for them to own and value wealth when they reach adulthood.

“This Government has already done much to extend the benefits of long-term saving through the introduction of schemes such as Individual Savings Accounts, Stakeholder Pensions, our all employee share ownership scheme and the new Pensioner Credit. The new Saving Gateway will mean lower income families not simply having interest payments tax free – the Government will match the savings people make. And the new Child Trust Fund will make it possible for children to own and value wealth when they reach adulthood.”

Education Secretary David Blunkett said:

“The new Child Trust Fund and the Savings Gateway will provide a vital first step on the road to self-reliance – taking people out of the dependency culture and giving them a real stake in society. Assets for all will be the fourth pillar of the welfare state.

“Young people will start out in life with financial backing behind them – helping to ensure disadvantage is not passed down from one generation to the next. It’s about the state helping you to help yourself – a something for something approach so that people can take greater responsibility for their own future.”

Social Security Secretary Alistair Darling said:

“We are determined to build a new savings culture in this country. Saving gives people independence as well as providing security in difficult times and comfort in old age.

“We want every child in Britain to have the confidence and security that savings can bring.”

Mr Darling said that the Government’s introduction of Stakeholder Pensions had extended choices to millions of people and cut the cost of pension saving across the board.

“Whereas the charges on some personal pensions could rise as high as 30 per cent with Stakeholders the management charges are capped at 1 per cent a year.

“This Government is determined to reward everyone who saves – not just a few at the top. For the first time ever the tax and benefit system will reward and encourage saving for everyone. Today’s proposals are another step in making opportunity for everyone a reality.”

Notes to Editors

1. The proposals in the consultation document are the result of work following on from the Treasury’s report Helping People to Save, published with the Pre-Budget Report in November 2000. More details are contained in the attached factsheet.

2. Copies of the consultation document can be obtained from the Treasury Press Office or by clicking on the link below.

Savings and assets for all

The Government recognises the importance of savings in providing people with:

• security if things go wrong;
• comfort in old age and retirement; and
• independence throughout their lives

The Government has already achieved a great deal in encouraging more people to save through the introduction of Individual Saving Accounts. ISAs have succeeded in extending the benefits of saving, both in terms of the amount of money being saved, and the number of new savers from lower down the income scale. Stakeholder pensions will extend the generous tax reliefs available to contributors to private pensions to those on low or irregular incomes, who, because of high charges, were disincentivised from saving in private pensions before.

The Government recognises that more needs to be done to extend the benefits of saving to lower-income earners. 46 per cent of those on household incomes of less than £200 and 43 per cent of those on less than £300 have no financial savings at all (excluding housing and pensions, but including current accounts). The Government also recognises that the tax reliefs offered by existing schemes, such as ISAs and stakeholder pensions, may not succeed on their own in encouraging those on lower incomes to save for themselves.

Therefore, the Government is announcing consultation on a new type of saving scheme for those on low incomes. This scheme is designed to act as a kick-start to bring these people into the habit of saving. The Saving Gateway account, which will be available only to those on lower incomes, will offer to match every pound saved in the account with a direct contribution from the Government. The Saving Gateway will run for a fixed period of time, after which savers will have the opportunity to transfer their saved assets into an existing vehicle – such as an ISA or a stakeholder pension or the Child Trust Fund (see below). The Saving Gateway proposal will also provide the financial education, information and advice needed to help people make the right financial choices for themselves.

The Saving Gateway will therefore act as a catalyst towards starting those on lower incomes on the road to greater financial independence, by giving them the financial assets and information necessary to take advantage of existing measures such as ISAs and stakeholder pensions.

As well as wanting to encourage the process of saving, the Government also believes it needs to provide more people with the immediate benefits of owning financial assets from an early age. There is compelling evidence to suggest that people with access to financial assets at the start of their working lives will enjoy significantly improved life-chances over those without such access. The Government therefore wants more people to be able to have the running start that owning financial assets brings.

Therefore, the Government is announcing consultation on a Child Trust Fund which will provide every new baby with an endowment to be saved for their future. The Child Trust Fund will be universally available, with higher levels of endowment to the children of lower-income parents, to ensure that the most help goes to those likely to need the greatest levels of assistance. The Child Trust Fund will run until children reach a certain age – perhaps eighteen or twenty-one – at which point they will gain access to their funds.

The Child Trust Fund will also allow parents, relatives, friends or the child in whose name the account is held, to make additional contributions in order to maximise the value of the assets they will have access to when they reach adulthood. Therefore, in addition to improving the asset-holding of future generations, the Child Trust Fund will be focus of the Government’s attempts to encourage these future generations to begin saving for their own futures from an early age. As such, the Child Trust Fund is a complementary policy both to the Saving Gateway and to existing measures such as ISAs and stakeholder pensions, in addition to addressing the problems of asset-poverty that many of today’s children will face in adulthood.

The consultation document asks for views on a wide range of practical issues, including:

• The best way of defining eligibility for the Saving Gateway and for the higher rates of endowment under the Child Trust Fund.
• The maturation span for each type of account.
• The questions of whether savers will have access to contributions made to each type of account, and whether there will be any restrictions placed on use of assets on maturation.
• The tax treatment of contributions into each type of account.
• Exact levels of endowment in the Child Trust Fund, and limits on additional contributions made into the fund.
• Exact levels of matching contributions in the Saving Gateway, and limits on contributions eligible for matching.
• The best way to integrate financial education, information and advice into delivery of both schemes.
• The role of private-sector financial services providers in delivering these schemes.
• Investment strategies for funds held in each type of account

Illustrative Examples of Saving Gateway and Child Trust Fund

The following examples show how the Saving Gateway and Child Trust Funds might work to deliver an asset base to all children, with additional incentives to save for families on lower incomes. The assumptions and figures used in these examples are for illustration purposes only, and do not represent the Government’s thinking on how final Saving Gateway or Child Trust Fund schemes would operate. Examples given below assume a 2.5% real rate of return on funds held in Saving Gateway and a real rate of 5% in Child Trust Fund accounts.

The Saving Gateway

The following illustrative assumptions for the Saving Gateway are used in calculating the example:

• that the Saving Gateway scheme is open to families or individuals earning at or below a set threshold for eligibility;
• that the Saving Gateway scheme lasts three years from the time that an individual opens it; and

• that the Government matches every pound put into the account, on a 1:1 basis, up to a monthly maximum of £50, the equivalent of an annual maximum of £600.

Example 1: Anne, who earns less than the threshold for eligibility, opens a Saving Gateway account and saves £25 a month for the full three years of the scheme. When the account matures, the value of Anne’s Saving Gateway will be £1,870 in real terms, adjusting for future inflation. This total will be comprised of:

• £900 of Anne’s own regular contributions;
• £900 of matching funds contributed by the Government; and
• £70 interest (which, for the purposes of this illustration, has been calculated on a monthly basis).

Child Trust Fund

The following illustrative assumptions for the Child Trust Fund are used in calculating the examples below:

• that for parents below a threshold income level, the Child Trust Fund pays an endowment of £800 for each child;
• that the endowment will be staggered over time, with £500 paid at birth, and further tranches of £100 paid at ages five, eleven and sixteen;
• that for all other parents, the Child Trust Fund pays a total endowment of £400, similarly staggered into an initial payment of £250 at birth, followed by three payments of £50 at ages five, eleven and sixteen.

Example 2: Daphne and Eric have an income below the threshold. When their baby, Jane, was born, the Government paid £500 into a Child Trust Fund for Jane. Janes grandparents also make regular monthly contributions of £5 a month into her Child Trust Fund. By the time she reaches the age of eighteen, Jane will have received further payments of £100 from the Government on each of her fifth, eleventh and sixteenth birthdays. When her Child Trust Fund matures, Jane will have access to assets worth £3,376 in real terms, comprised of:

• a £800 endowment from the Government;
• £1,080 of regular contributions from her grandparents; and

£1,496 of interest, calculated monthly.

Example 3: In Example 3 above, when Jane is born, Daphne decides to start saving in a Saving Gateway. Like Anne from example 1, Daphne saves £25 a month, and receives matching support from the Government. At the end of the three-year lifetime of her Saving Gateway account, Daphne has accumulated £1,870 (including matching payments and interest). Daphne decides to put £1,000 of this amount immediately into her daughter Jane’s Child Trust Fund. She invests the remainder in a mini cash ISA. When Jane’s Child Trust Fund matures, it will have a total value of £5,455 in real terms, comprised of:

• a £800 endowment from the Government;
• £1,080 of regular contributions from her grandparents;
• a £1,000 lump-sum contribution from Daphne’s Saving Gateway; and
• £2,575 of interest, calculated monthly.

Example 4: Bill and Claire – who have an income above the threshold level – give birth to their first child, John, and receive an initial endowment of £250 into John’s Child Trust Fund. Bill and Claire make regularly monthly contributions of £10 a month into John’s fund, until he is eighteen. John also receives additional payments of £50 from the government on his fifth, eleventh and sixteenth birthdays. When John turns eighteen, the value of his Child Trust Fund will be £4,288 in real terms, made up of:

• a £400 endowment from the Government
• £2,160 of regular contributions from his parents
• £1,728 of interest, calculated monthly.

The press release issued by HM Treasury on 30 April 2001.

The Treasury today confirmed the dissolution of the Insurance Brokers Registration Council (IBRC), the body previously responsible for insurance brokers’ professional standards.

Instead the industry will be regulated by the General Insurance Standards Council (GISC).  The GISC, unlike the IBRC, is open to all insurance intermediaries and will set its own standards of business practices.

The move forms part of the planned overhaul of financial services regulation by the Treasury.

Economic Secretary to the Treasury, Melanie Johnson said:

“The new regulatory arrangements represent a major step forward for the general insurance broking industry.  Brokers of general insurance will now be able to operate free of the red tape they were previously burdened with.

I welcome the establishment of the General Insurance Standards Council and the move by the industry to set its own standards.  I am also grateful for the work of the IBRC in ensuring an orderly run down of its operations.”

NOTES FOR EDITORS

The change relates to general insurance only, e.g. home and travel insurance and not long-term investment-based insurance, e.g. life assurance.

The IBRC was set up under the Insurance Brokers (Registration) Act 1977(IBRA).  IBRC regulated the use of the title ?insurance broker? and maintained professional standards among those intermediaries that used it.

But this was seen as incompatible with the Government’s move towards a single financial services regulator.  There were also a number of flaws such as the fact that the IBRC captured only those who chose to trade as insurance brokers, but not the many other general insurance intermediaries.

In early 1998, the Treasury consulted on the future of the IBRC.  Most of those responding said that voluntary regulation offered the best prospects for improving standards of conduct among general insurance intermediaries.

The then Economic Secretary, Helen Liddell, announced (in July 1998) the repeal of the Insurance Brokers (Registration) Act 1977, and consequent abolition of the IBRC.

The industry has now set up the General Insurance Standards Council (GISC) a voluntary body to carry on many of the IBRC’s tasks.

The Financial Services and Markets Act 2000 (FSMA) repealed the IBRA and the IBRC’s dissolution was put into effect under two Statutory Instruments – SI/2001/1283 (the main Dissolution Order) and SI/2001/1282 (a Commencement Order).  The IBRC ceases to exist today.

The Treasury is to take over the assets and liabilities of the IBRC.

As a result of this change, insurance brokers will no longer be exempt from the Estate Agency Act 1979 which regulates the activities of estate agents in the buying and selling of property.

The press release issued by HM Treasury on 10 May 2001.

UNCERTAINTY OVER FOR CHESTER STREET VICTIMS

The uncertainty of asbestosis sufferers and their families whose expectation of compensation was thrown into doubt by the insolvency of Chester Street on 9 January this year will soon be over thanks to a partnership between the insurance industry and Government.

Andrew Smith MP, Chief Secretary to the Treasury, said:

?This is good news for asbestosis sufferers and their families whose personal tragedies were made even worse by uncertainty over whether they would receive the compensation they were due following the collapse of Chester Street. It is also an excellent example of partnership between Government and the private sector, in which the Government is meeting its liabilities to former public sector employees and the insurance industry is covering claims from former private sector employees.

?I would like to pay tribute to the constructive and cooperative approach taken by the insurance industry, who have shown great flexibility in dealing with a very complex legal situation?

Concerns had been raised over the position of employees whose private sector employer insured with Chester Street and no longer exists or is insolvent, and whose injury was sustained during employment in the private sector before 1972 (1975 in NI). There were fears that these individuals would not receive the compensation for which their employers would have been liable.

However, the insurance industry will fund compensation to those individuals in the following circumstances.

The Policyholder’s Protection Board (PPB) will make payment in accordance with their statutory powers if the compensation award was made prior to Chester Street’s insolvency on 9 January 2001.

If the award was made on or after 9 January, the insurance industry will fund equivalent payments pending the implementation of the new industry funded Financial Services Compensation Scheme (FSCS), planned to come into effect no later than November this year. The Financial Services Authority (FSA) have been asked to explore rules to cover employee third party rights in employer liability cases to ensure that in cases where both the employer and the insurer are insolvent, victims receive compensation. The Government will itself fund the compensation owed to former employees of public sector companies for whom it is liable.

The arrangements outlined above apply only when the employer no longer exists or is insolvent. Where the employer still exists, or its liabilities have been carried forward to another company, that company or firm are liable to pay the compensation award.

Andrew Smith was responding to a Parliamentary Question from Tony Worthington MP (Clydebank & Milngavie).

The press release issued by HM Treasury on 21 May 2001.

UK ADOPTS REGULATORY CO-OPERATION WITH ARGENTINE FINANCIAL SERVICES SECTOR

UK and Argentina have signed a Memorandum of Understanding which will ensure greater co-operation in tackling the abuse of financial rules and regulations.

The agreement was signed by Miss Melanie Johnson, Economic Secretary to the Treasury, Sir Howard Davies, Chairman of the Financial Services Authority, and by Mr Carlos Weitz, Chairman of the Comision Nacional de Valores of Argentina.

The Memorandum of Understanding also opens the way for UK investment service firms to access the domestic Argentine market, and for Argentine securities to be traded on the UK exchanges. The volume of cross-border business should rise accordingly to the benefit of UK and Argentine investors and markets.

The press release issued by HM Treasury on 4 July 2000.

The Treasury today exercised its powers under the Financial Services and Markets Act 2000 (the Act) for the first time.

An order has been laid before Parliament specifying that Schedule 21 to the Act, which amends the application of parts of the Financial Services Act 1986 to self-regulating organisations recognised under Chapter III of Part I of, and Schedule 11 to the 1986 Act, will apply in relation to the Personal Investment Authority (PIA) and Investment Management Regulatory Organisation (IMRO) from 25 July 2000.

Economic Secretary Melanie Johnson said:

“This order will allow the new single regulator for financial services, the Financial Services Authority (FSA), and the PIA and IMRO to take practical steps to prepare for the bringing into force of the Financial Services and Markets Act.

“By ending the power of the FSA to make compliance orders or revoke recognition, it will allow the boards of PIA and IMRO, companies limited by guarantee, to bring into force amendments to their constitutions to make them subsidiaries of the FSA. This means that from 25 July 2000 the power of appointments to the Boards can be passed to the FSA, and the FSA can be admitted as a member so as to facilitate winding up of the companies in due course.

“The moves are fully supported by both PIA and IMRO, with the backing of their members. This is a small but important development that will enable further integration to take place between the regulators concerned. It is a mark of our shared commitment to deliver the wide ranging benefits provided under the FSMA 2000 as early as practicable.”

The press release issued by HM Treasury on 5 July 2000.

A £1 billion investment in buildings, laboratories and equipment for science research was announced by Chancellor Gordon Brown, Trade and Industry Secretary Stephen Byers and Education Secretary David Blunkett today. Also announced today is new money for science and engineering PhD students.

The new two year Science Research Investment Fund partnership between Government and the Wellcome Trust will mean Government investment in science infrastructure of £325m in 2002/3 and £450m in 2003/4. The Wellcome Trust will provide £225m to support biomedical research.

This is additional to the settlement for science in the previous comprehensive spending review, including a Government/Wellcome Trust Joint Infrastructure Fund (JIF) for universities of £750m, which runs until 2001/02.

Speaking at a conference of UK and US entrepreneurs in London, Mr Brown said:

“The commitment to science must mean constant renewal and modernisation of our science base. The scale of this investment is unprecedented, ensuring world class facilities for world class science. I am most grateful to the Wellcome Trust”.

Stephen Byers said:

“We have world class scientists in the UK. They rightly deserve world class facilities and this is exactly what we are now delivering. This unparalleled partnership will mean that scientists in the UK will have the facilities to be at the cutting edge of research worldwide. Following on from the Joint Infrastructure Fund we set up with the Wellcome Trust in 1998 this will enable us to repair the damage done in previous decade.”

Wellcome Trust Director Mike Dexter said:

“Our collaboration with Government is already delivering crucial new investment to the UK’s universities. There is a great deal more to be done to keep UK science at the cutting edge, and I am proud that Wellcome has again been able to partner the Government to achieve that”.

The fund steps up Government’s commitment to modernising the science base. It reflects the findings of the science research cross-cutting review that – despite the positive impact of JIF – further major capital investment is needed. Consultation with universities showed that this was one of their most pressing concerns. As well as universities, Government research institutes and large national science facilities will benefit from the new fund.

The Chancellor also announced an uprating in PhD stipends for science and engineering postgraduate students. Basic stipends, outside London currently £6620 a year, will rise to £6800 in the coming academic year, to £7500 at the beginning of the 2001/02 academic year and to £9000 by academic year 2003/4. This is a 23% increase in real terms.

The Chancellor said:

“Alongside physical capital it is vital that we invest in human capital. Postgraduate researchers are the lifeblood of our science base. This investment will ensure that we continue to attract the finest minds into Phd programmes”.

David Blunkett said:

“This is investment that will keep Britain in the lead in research. We have a proud record. The Government is committed to sustaining our position. This is excellent news for universities and for the research teams themselves.”

The press release issued by HM Treasury on 11 July 2000.

Increases of up to 30 per cent in their retirement nest egg and greater freedom in their working lives could be possible for some personal pension savers using the new individual pension account (IPA), Economic Secretary Melanie Johnson said today.

The new IPA will particularly benefit those on moderate incomes, including part time workers, and those taking family or educational career breaks. It will enable the millions of pensions savers to have better, more flexible pension arrangements, which will be ideal for use with stakeholder pension schemes.

Miss Johnson and Social Security Secretary Alistair Darling today published a joint paper outlining the key features of the IPA, and seeking views on a small number of issues remaining following earlier consultation with pension providers and pension savers’ representatives.

Welcoming the paper, Miss Johnson said:

“IPAs will offer many thousands of personal pensions savers new freedom to plan and diversify their working lives They can take time off work or change jobs, possibly several times, without losing out on retirement savings as a result.

“IPAs will be suitable for many people on moderate incomes. They may be particularly helpful to women, who are more likely to take part time employment or to take career breaks when starting a family, or for those returning to education or training courses. Both those individuals and the economy will gain from the benefits IPAs offer.

Pointing out their suitability for long term pensions planning and use with stakeholder pensions, Mr Darling said:

“We want more people to save for their retirement. The IPA complements other reforms such as the new stakeholder pensions. We wanted everyone to have the right options for them and the IPA gives more choice for saving.”

Both IPAs and stakeholder pensions will become available in April 2001. Case study examples of the potential to enhance the value of pensions for those seeking flexibility in their working career are attached.

The advantages of IPAs in pensions saving include a simple charging structure, spread investment risk, security, transparency, and better understanding and confidence in equity investment. The IPA concept was based in part on the popular and successful US s401(k) savings scheme, which has encouraged savings generally, and equity savings in particular.

The development of IPAs marks a key stage in delivering the Government objective of providing secure, flexible and value for money pensions. The paper published today shows how IPAs will work and the steps the Government will take to ensure their availability when stakeholder pensions are launched in April next year. The areas covered by the joint Treasury and DSS paper include:-

• the IPA concept
• how it works in practice
• moving pension scheme with IPAs
• using IPAs for stakeholder schemes
• the legislative framework
• points where further views would be welcome.

Movement of IPA investments between savings schemes will be made easier by the introduction of a relaxation of stamp duty reserve tax rules to put IPAs on the same footing as pension savings in life insurance based products.

The press release issued by HM Treasury on 11 July 2000.

A Treasury-led review published today by the Chief Secretary, Andrew Smith, says much more needs to be done to reduce the incidence of ill health retirement across around 4 million employees in the public sector.

Its 36 recommendations include:

• employers should have active procedures and measures for managing sickness absence bolstered by effective policies to promote health in the workplace
• redeployment is always considered when existing duties are contributing to an employees’ ill health
• ill health retirement should only be granted when an employee is incapable of working until normal pensionable age
• inability to carry out existing duties is too narrow a test for an ill health pension
• greater consistency and rigour is required in the medical assessment process
• Service Delivery Agreements agreed in the 2000 Spending Review should set targets for reductions in ill health retirement

  The report shows ill health retirement:

• costs the taxpayer £1 billion a year
• runs at 22,000 a year
• peaked in the mid – 1990’s at 40,000 a year, but is still at historically high levels
• varies widely both between the rates in different sectors and between employers in the same sector

Mr Smith said:

” Early retirement should be available on genuine medical grounds where there are good reasons, but levels are higher than they should be. We are determined to bring them down to deliver a fair deal for the taxpayer and the people who depend on public services.

“The overall rate of medical retirement is higher in the public sector than in the private sector. And the variations in rates between sectors, and between employers in the same sector, are so significant that there is clearly scope to bring the rate down. This will help employees as well by ensuring employers adopt best practice to protect their health.

“The report sets out thirty six recommendations for tackling this issue. It is important that they are followed through vigorously across the public sector. Ill health retirement costs the taxpayer £1 billion each year. We need to divert those resources which are used unnecessarily to fund medical retirements to front line services.

“I have asked Departments to draw up action plans for each sector implementing the recommendations. Targets will be set challenging the employers with the highest rates to reduce these to match those of the best in their sector.”

The press release issued by HM Treasury on 17 July 2000.

The Chancellor, Gordon Brown, today called for fast-track completion of the single European financial services market and called for a plan for a 2004 implementation date.

Proposing early implementation of priority measures, Gordon Brown said:

“A dynamic single financial market is key to achieving fundamental economic reform and prosperity across Europe.

“Businesses, including start-ups and SMEs, will benefit from deeper, more liquid capital markets, which in turn will deliver growth and jobs. And consumers and investors will benefit from more competition and innovation, driving down prices and delivering a wider and better choice of financial products.

“Today I have set out practical steps to reinforce the Financial Services Action Plan and deliver the strategic goal agreed at Lisbon – to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion.

“That is a goal worth striving for but there is a case to achieve it on an even faster track: with will and determination, we can have a genuine single capital market by 2003 and complete a single market in financial services by 2004, bringing economic prosperity to citizens and business across the EU.

“We must focus on measures which will deliver early benefits. And, in the spirit of our Lisbon goal, we must embrace competition, innovation and flexibility.”

Key proposals set out by the Chancellor in a paper published today include:

• fast-tracking priorities in the Financial Services Action Plan;
• bringing forward the target date by one year to 2004;
• speeding up the completion of the capital market – a new deadline of 2003;
• delivering a competitive financial services market based on mutual recognition of core standards to ensure the integrity of financial markets and protection of consumers;
• a framework which recognises diversity of regulatory approaches, is responsive to market developments and encourages co-operation and exchange of information between supervisors;
• developing clear indicators and measures of success – for example, of the depth and liquidity of capital markets and price differentials for standard financial services products.