What's new in Capitalise v21.1?
Capitalise v21.1 is now ready to download, and all users have been sent an email with the appropriate download code.
user help 20/05/2016
- New financial year
All necessary financial information has been updated to reflect the current tax/benefit allowances and rates for 2016-17.
- Life expectancy
Note that this year, for the first time, the ONS12 predictions used for 2014-15 and for 2015-16 as the default male and female life expectancy tables for the calculations have been replaced by ONS14, now regarded as the most appropriate basis for the Duxbury Calculations.
The ONS14 projections have higher mortality rates and thus show lower life expectancy figures than ONS12 for a given age (particularly for females), in part due to very low improvements in mortality at older ages over the years 2012, 2013 and the first part of 2015.
An earlier set of tables, PA92, contained data for men and women in insured pension schemes, and was adopted for Duxbury Calculations in editions until 2013-14. The longevity postulated for that narrower demographic has now been exceeded by that predicted in the ONS14 Tables for the general population, except at the oldest ages for females.
- Quantitative easing
The 'quantitative easing' (a temporary reduction in the assumed yield in year one to 1.5% before reverting for all subsequent years to the normative level of 3% p.a.) introduced in the financial year 2009-10 has been extended into this, an eighth year.
- State pension (amount)
An underlying assumption for 'default' calculations is that the recipient will be or will become entitled to a 'full' state pension (an assumption which will for some individuals be invalidated by the abolition, since April 2016, of the right to rely on an ex-spouse's National Insurance contributions).
- State pension (age)
State pension age changes introduced by the Pensions Act 2014 are reflected in Capitalise calculations.
The state pension age is currently 65 for men and gradually increasing for women from 60 to 65 - it is 62½ from April 2015.
From December 2018, it will start to increase for both men and women to reach 66 by October 2020. The government plans further increases to raise the state pension age from 66 to 67 by 2026. They will then review it every five years in line with life expectancy.
You can see the date at which state pension age is reached, listed in bands according to the recipient’s date of birth, in Preferences.
- Gender of recipient of Duxbury award
Notwithstanding the implementation into UK insurance law of the March 2011 decision of the CJEU decision prohibiting the inclusion of differential gender-based risks on the calculation of insurance premiums and annuity rates, Duxbury calculations continue to be shown separately for male and female recipients. The view is taken that that decision is not directly applicable to the task in hand. It may be that it will be successfully argued (presumably by a husband - whether claimant or respondent) that differential rates are inapposite, but until then Capitalise will continue to publish comparative figures. To implement unified rates would result in women receiving markedly lower, and perhaps men more generous, awards which it would be difficult to justify objectively.