Savers approaching retirement are being advised to put off buying a lifetime annuity – or even to consider deferring retirement – as the euro crisis further reduces the income offered to UK pensioners.
Pension experts issued the advice after the FTSE 100 index suffered its largest one-day fall since November, as investors fled equities on fears of a Greek exit from the single currency – and bought into “haven” assets, such as government
This shift is significant for those planning their retirement as both the annuity income they can buy with their pension funds, and the income they can draw directly from their funds are determined by the yields on government bonds, or gilts. Heavy buying has pushed gilt prices up, reducing yields to record lows.
“It’s such an awful and difficult situation for anyone approaching retirement,” said Dr Ros Altmann, director-general of the Saga Group, the financial services group for over-50s. “If you can delay, it is worth considering because at some point there should be a correction in rates.”
Joanne Segars, chief executive of the National Association of Pension Funds, said: “People who are nearing their retirement need to think carefully about whether this is the right time to lock into the current low rates of interest.”
Advisers suggested taking pension cash in stages. “It’s possible to phase into retirement by taking tax-free cash only,” said Mike Morrison, head of pensions development with Axa Wealth. “In the short term, it may be possible to take income from elsewhere.”
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KINGSTOWN, St. Vincent – Construction of the EC$652 million Argyle International Airport is on track to meet the 2013 completion schedule, a progress report from Prime Minister Dr. Ralph Gonsalves this week suggested.
“I just don’t understand some people when they say that ‘nutten happening out dey’ despite every time you go you see such phenomenal changes,” he said at a press briefing Tuesday as he detailed the work that has been done since the project commence in August 2008.
“You know, sometimes, when I hear some people talk, I wonder if they eat something at night and they lie down and it ride their stomach and they dream that nothing [is] going on. Because it is talking place before your eyes,” he said, employing part of an analogy that landed him much criticism some years ago when some citizens accused him of mocking of Spiritual Baptists.
Gonsalves told reporters and radio audiences that as of May 12, 75 per cent of earthworks on the runway, apron and taxiway were completed and the International Airport Development Company (IADC) — charged with oversight of the project — plans to complete 90 per cent by yearend.
All earthworks will be completed by the middle of next year, he said, noting that EC$4.4 million has been spent on blasting and 300,000 kilogrammes (0.66 million lbs) of explosives have been used since work began in August 2008.
“When we say we had to move three mountains and fill three valleys, span a river and so on and so forth, it is not an easy business you know,” Gonsalves said, adding partly in dialect, “Unless you have a vision and you have the fortitude to go ahead with this lot ah man wudda done fall down.”
The base-laying and pavement will begin later this year, hopefully by September, he said, explaining that there have been some delays because of equipment procurement.
The IADC therefore decided to redo its work plan and will continue with earthworks rather than pavement, doing both simultaneously when paving begins.
The state-owned firm is assembling the equipment needed for pavement works, some of which is being provided by an US$4.2 million (EC$11.34 million) grant and loan to the government by the CARICOM (Caribbean Community) Development Fund.
The IADC has awarded the equipment procurement contracts to three international firms.
NSG West Indies Ltd. won the US$1.06 million contract to provide the stone crushing plant.
The US$2.3 million quarry and base-laying equipment deal was awarded to RIMCO
GECI Española has been awarded the US$1 million contract for airfield lighting equipment and generators.
The project has already received some of the quarry and base-laying equipment and expects to get the stone crushing plant by the end of June.
The IADC intends to do the pavement works in house and to set up its own industrial complex, complete with stone crusher, asphalt and concrete batching plants and supporting equipment, Gonsalves said.
A 70-member team, including 32 Cubans who will arrive next month, will be involved in this aspect of the project.
Sea defences, trucks, wind study
The construction of sea defences will start later this year at the northeastern end of the runway and the IADC is negotiating the purchase of the ARMCO system for preparing culverts to divert the Yambou River under the runway.
The company is also trying to acquire new trucks even as it tries to keep a fleet in working order, Gonsalves said, noting that vehicles at the project have been used 12-hours a day, seven days a week for the last 45 months.
“That’s not easy work you know. And if you think that is cheap, these equip consume almost EC$10 million worth of fuel so far — 1.5 million gallons. It’s a lot of work and you notice we are keeping a track as to the quantity and everything else that we use …”
Wind studies are continuing and the data collected over the last three and a half years suggest that a crosswind runway might not be needed. But even if one is needed, it will only be 1.5 per cent of the cost of the project, Gonsalves noted.
The Taiwanese firm Overseas Engineering Construction Company (OECC), as of May 11, had completed 23 per cent of the terminal building and had received US$12.2 million of the US$26.5 million contract.
Of that sum, the IADC contributed about US$2.3 million while the government of Taiwan paid the remainder.
And while the size of the mezzanine floor has been doubled to 10,000 square feet to accommodate two executive lounges instead of one, Gonsalves said this adjustment was not expected to affect the cost of the building “in any significant way”.
The control tower, fire and rescue station, and cargo terminal building — expected to cost US$5 million — will be bundled in three distinct packages for tender.
The fire and rescue station is to start later this year even as the IADC tries to have a private firm to finance and operate the cargo building and hopes that construction can begin no later than May 2012.
Meanwhile, talks are underway with a private sector entity interested in operating the aircraft refuelling facility.
Access roads, land use plan
Construction of the Argyle Gardens access road will resume later this year while works on the Rawacou access road, suspended because of the effect of blasting, will recommence when the blasting is completed.
Gonsalves said that Cabinet has received some broad conceptual outlines for a land use plan even as a final copy will have to be approved by the Cabinet.
Environmental monitoring and preservation of national heritage, and promotion of the airport are on-going.
Financing is on target, said Gonsalves, who is Minister of Finance. He said monies come from land sales, the central government, the sale of government shares in the Bank of St. Vincent and the Grenadines, and PetroCaribe.
He further said that businessman Denzil Bacchus has donation the second EC$20,000 tranche of an EC$100,000 pledge to the airport.
At end of April, OECC’s workforce was 196 skilled and unskilled Vincentians and 26 foreigners while the total workforce at the project was almost 400, Gonsalves said.
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Even though yesterday was a bank holiday in the UK, the currency markets were still open, with the euro suffering against most major currencies after the elections
over the weekend. The voter backlash against recent austerity measures has bought in a new president in France, with the new president, Francois Hollande, wanting a more growth friendly approach and renegotiation of the fiscal compact. This puts France on a collision course with Germany and the EU who are firmly against any renegotiation. In addition to this, Greece has also caused more pain for the struggling single currency, as the 2 main parties supporting the country’s international bailout failed to secure a parliamentary majority, raising further questions of Greece’s membership of the euro.
Due to the level of uncertainty the new government in France and lack of any majority in Greece Sterling gained further ground against the euro, moving to a 3 ½ year high against the single currency. Now that the rate has moved above the 2010 high of €1.24, the door is potentially open for further gains, especially in the short term whilst Greece struggles to form a government. One word of caution to any euro buyers, is once the uncertainty over Greece is resolved we could see these recent gains given back and the pair drift back towards the low €1.20’s
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CASTRIES, St Lucia, Friday April 27, 2012
In spite of rising competition and what they call the general “volatility” of the industry, local tourism stakeholders are lauding a marked increase in the number of stay-over visitors to St Lucia for the first quarter of this year.
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