The National Association of Pension Funds (NAPF) commented on the Treasury announcement today to change rules on pension annuities.
Joanne Segars, NAPF Chief Executive, said:
“Such extra flexibility can be useful, but these changes will mainly benefit those with larger pensions and multiple income streams.
“Annuity rates may have fallen recently, but the guaranteed income they offer is usually the best option. We think most people will still end up choosing an annuity.
“The real problem is that people are simply not saving enough into their pension pot in the first place.
“The Government should be doing more to encourage strong workplace pensions and creative, flexible ways of saving for retirement.”
On the new Minimum Income Requirement of £20,000 to allow ‘flexible drawdown’ from a pension.
Ms Segars added:
“The bar is high enough to ensure that most people won’t fall back on means-tested benefits, but it’s also high enough to prevent most from using flexible drawdown.”
Notes to Editors:
1) The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,200 pension schemes with some 15 million members and assets of around £800 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.
Paul Platt, Head of Media and PR, NAPF, 020 7601 1717 or 07917 506 683, [email protected]
Christian Zarro, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]