Pensions

(asked on 15th June 2015) - View Source

Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what discussions he has had with pension providers on problems in accessing pension benefits since 6 April 2015.


Answered by
Justin Tomlinson Portrait
Justin Tomlinson
This question was answered on 18th June 2015

The April 2015 reforms have given people more freedom and choice on how they fund their retirement. Individuals with Defined Benefit Pensions and pension benefits which contain a guaranteed annuity rate can transfer to a Defined Contribution scheme if they wish to access their pension savings flexibly, after they have taken independent financial advice.

The Government is committed to monitoring the new pension flexibilities as they bed in. This is why the Chancellor has announced a consultation to identify the extent to which people are facing unfair barriers to accessing their pensions flexibly and to identify whether further interventions are necessary. We will be working with Treasury, the Financial Conduct Authority and the Pensions Regulator to ensure the flexibilities are delivering for consumers.

DWP does not currently have data on the number of people who have converted their safeguarded benefits to a form that can be taken flexibly since 6 April 2015, or on the numbers of people who have taken independent advice. Nor do we have data on the number of people who would not have previously had to take advice but now will as a result of the FCA rules announced on 8 June 2015. Those affected may include members with a DB pension or a pension with another form of safeguarded guarantee whose total benefits are worth over £30,000 as well as people with Guaranteed Annuity Rate entitlements. However, the Pension Regulator is in the process of gathering data, on the number of Defined Benefit to Defined Contribution transfers through their annual scheme return and this will include the number of transfers out under £30,000. This data will be available from Spring 2016.

The pensions industry is responding positively to the new reforms and the Pensions Regulator is publishing guidance to support pension schemes and help trustees understand the new requirements.

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