Citywire for Financial Professionals
Stay connected:

View the article online at http://citywire.co.uk/money/article/a637011

Tory rallies MPs to fight for pension income reform

Conservative MP Alun Cairns is rallying support among his colleagues to call for reform of income drawdown, as savers continue to face dramatic cuts to the income they are able to take.

 
Tory rallies MPs to fight for pension income reform

Conservative MP Alun Cairns is rallying support among his colleagues to call for reform of income drawdown, as savers continue to face dramatic cuts to the income they are able to take.

According to the Mail on Sunday, Cairns (pictured) expects to get the backing of 20 to 30 fellow Conservative MPs in his campaign to force Treasury ministers to act on the issue. Savers have been hit by April 2011 rules limiting the amount that can be taken to 100% of Government Actuary's Department rate, down from 120%.

Cairns told the paper he had been contacted by numerous members of his Vale of Glamorgan constituency angry at the drop to the income they can take. He said those hit by the change were 'Conservative supporters - successful entrepreneurs and businessmen. The changes are unfair and need amending'.

Sipp provider AJ Bell recently renewed its campaign to return the government's GAD rate, which limits the amount of money pensioners can draw down from a pension fund, to the pre-2011 level of 120%.

3 comments so far. Why not have your say?

Knoddy

Nov 26, 2012 at 10:13

This problem is nationwide and has been caused by inexperienced Treasury people tinkering with pensions. Everybody knows who the main culprit is; he should be sacked and put in charge of a hamburger stand instead.

report this

john4b

Nov 26, 2012 at 11:19

I believe that many retirees on drawdown have approaches there local MPs to help voice their concerns at the severe drop in their income following rule changes made by Government on 6 April 2011. My local MP has done so twice on my behalf and on both occasions received a standard “Dear John” reply, one from Mark Hoban MP and one from Sajid Javid MP. It is therefore presumed that all who approached their respective MP for help also received a similar standard reply.

Alun Cairns should therefore be rallying ALL MPs to demand that the Treasury take immediate action and listen to experts like Mr Andy Bell of AJ Bell who has been fighting this case on our behalf.

How are we expected to adopt long term retirement income planning when the treasury introduce changes which have an instant and detrimental effect on these plans?

It appears that Government just maybe having a rethink of their policies with an announcement due on 5 December. I hope they don’t merely scratch the surface but give all on drawdown proper access to THEIR money.

report this

Dunkelmann

Nov 26, 2012 at 13:36

As I approach retirement, I feel the right thing to do is not to put any money into my pension pot, but to save it outside the clutches of the government. At a cost of foregoing the tax relief, I can then choose when and how much to spend.

Tax relief can change at the whim of the government. It's my money and I've had the wherewithall and ability to save it. I should also have the right to spend it as I choose. Are they so stupid to think a canny saver needs to be protected from themselves by blowing it all as soon as they retire?

No I'll carry on as I am, being prudent and working out what rate I can spend it at given my likely life span.

report this

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

The Citywire guide to investment trusts

In association with Aberdeen Asset Management

Fund managers from Standard Life Investments quizzed on investment trusts


What can SLI bring to the table for those who want to put their money into investment trusts?

Today's articles

Tools from Citywire Money

From the Forums

+ Start a new discussion

Weekly email from The Lolly

Get simple, easy ways to make more from your money. Just enter your email address below

An error occured while subscribing your email. Please try again later.

Thank you for registering for your weekly newsletter from The Lolly.

Keep an eye out for us in your inbox, and please add noreply@emails.citywire.co.uk to your safe senders list so we don't get junked.

Read more...

How much?! HSBC charges £9k to set up a Sipp

by Daniel Grote on Aug 20, 2014 at 16:39

Sorry, this link is not
quite ready yet