PPFM – Principles & Practices of Financial Management

Recent changes to the PPFM

The Principles and Practices of Financial (PPFM) are reviewed by the Board regularly, and the most recent changes agreed are summarised below. The current (April 2024) version of the PPFM is available here.

The PPFM was updated in April 2024 to make minor enhancements to Lifetime ISA, Monthly Savings ISA and Junior ISA policies, and also to reflect changes to improve the clarity and presentation of the document with no material changes to its substance.

The changes made to the Lifetime ISA, Monthly Savings ISA and Junior ISA policies provided that:

  • From 6th April 2024 asset shares for all open tax year Lifetime ISA policies issued under Table 31 will benefit from the higher of (1) the guaranteed reversionary bonus rate applicable for that tax year and (2) the adopted return applied to other Lifetime ISA issued under Table 31 for that tax year. This is instead of always receiving the guaranteed reversionary bonus rate for that tax year.
  • From 6th April 2024 asset shares during the year of subscription of open tax year Monthly Savings ISA and Junior ISA policies issued under Tables 32 and 33 will benefit from the higher of (1) the guaranteed reversionary bonus rate applicable for that tax year and (2) the adopted return applied for that tax year to other Monthly Savings ISA and Junior ISA policies issued under Tables 32 and 33. This is instead of always receiving the guaranteed reversionary bonus rate for that tax year.
  • The surrender charge applicable for surrenders of Lifetime ISA policies during the year of subscription will be waived for withdrawals made for a qualifying house purchase on or after 6th April 2024, so that no surrender charges apply to withdrawals made from a Lifetime ISA for a qualifying house purchase.

Summary of Changes in 2022 and 2023

The PPFM was previously updated in March 2022 and in January 2023 to remove redundant wording, to improve the clarity of the text and reflect current practices, with no material changes to the principles. The changes included:

  • Inserting the specific dates between which Monthly Savings ISA policies were issued under Tables 29 and 30, and the date from which Monthly Savings ISA policies have been issued under Tables 32 and 33.
  • Including under Investment Strategy that the Board has set a minimal appetite to invest into areas that will have a detrimental effect as a result of climate change.
  • Reflecting enhancements made to the Society’s practices for reviewing the matching of its investments and its accrued guaranteed liabilities.

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