The committee wants to find out if mutuals bring benefits to customers that they don’t get from non-mutuals and if there is a case for legislation to protect them.
This is a last-chance lifeline for mutuals. They are gloomy about their future unless the Government changes the law to hold-off cash-rich predators and individual carpetbaggers.After hearing the evidence on both sides, the committee will report in September. It may make recommendations for new legislation or it may simply suggest the market be allowed to take its course. Either way, there is no obligation on the Government to take any notice of the findings.So why do mutuals need protecting? I believe it’s a matter of keeping real choices for customers A mutual doesn’t have to please its shareholders.

If you are a with-profits policyholder at Scottish Widows, for example, you may be delighted with the windfall but not so pleased that 10 per cent of all future profits on your fund will now go to Lloyds TSB shareholders.Many of those eager to embrace the market argue that the likes of Scottish Widows are giants, far removed from the ideals of a local society set up to offer self-help at low cost to its members. Fine, but what’s wrong with a big mutual? The building societies have proved they can offer very competitive mortgage and savings rates, and they still embrace a wider range of customers than a streamlined bank geared to maximise profits. The exclusion of the poor and elderly from mainstream financial services is a growing problem, and the loss of mutuals as a credible force will only make it worse.The think-tank Demos has just released a report suggesting that mutuals of all sorts have a bright future. Although many of its ideas concentrate on grass-roots organisations such as credit unions, Demos makes the point that in many continental countries the members and executives of mutual banks are stopped by law from benefiting financially in the event of a conversion.If the top executives at our ex-mutuals had been prevented from making personal fortunes through their actions in converting or courting a takeover, how many mutual financial companies would we still have now? It’s an intriguing question, and one which the Treasury select committee may care to put to Christopher Rodrigues, chief executive of the Bradford & Bingley.

He has been called to give evidence on the building society’s planned demutualisation.n i.berwick independent.co.uk. Your fund has consistently underperformed. Meaning that over the last three to five years its performance has failed to match that of the average in its sector

Your objectives change. For example, you want to take an income from your fund instead of growth.
Your attitude to risk has changed. For example, you want to switch from the Far East sector to UK growth.An influential fund manager leaves your investment house.Your investment house is taken over. Check if the same fund managers stay on, and in what capacity.. You cannot buy a new personal equity plan anymore but you can still trade one PEP fund for another one, either with the same provider or another firm.

The PEP transfer market is going to be big business in the next few years. The advantage of swapping your PEP, if nothing else, is that it gives you the chance to swap a poor performer for something more consistent. PEPs, like their successors, ISAs, are merely tax-free wrappers around stock market funds – be they unit trusts, investment trusts, Oeics (open- ended investment companies) or corporate bonds Performance varies greatly. “You do need to ensure that your investment is in a good- performing fund, even if you only took out a PEP in April,” says Warren Perry, an independent adviser at Whitechurch Securities. “It is no good having tax breaks that are not backed by good performance.”
Among the big fund managers, Perpetual has 21 funds that are PEPable. Its growth funds and income funds all charge a 5.25 per cent initial fee on the amount you invest and levy between 1.25 and 1.5 per cent in annual management charges.Jupiter has a 5 per cent initial charge and a 1.5 per cent annual charge. On PEP transfers it is operating a 1 per cent discount on its initial charge until the end of the year.Fidelity is attracting PEP transfers because of its low charges.

Its MoneyBuilder range, which has a UK index tracker fund, a corporate bond, a growth fund and a fund of funds, has no upfront charges and no exit fees Annual fees are also low – between 0.5 and 1 per cent. M&G also has low costs on its Managed Growth, Managed Income, Blue Chip, Index Tracker and Corporate Bond PEPs.You should be cautious about PEP transfers. The main reason for swapping should be long-term underperformance. If your fund fails to match the average growth of its index (for example, an income unit trust would be matched against the UK equity and bond index) then it is time to switch But you need to look beyond short-term statistics.