Hargreaves Lansdown’s share price bounced by nearly 15% on the news that George Osborne is to introduce a new ‘super ISA’, but life companies took a beating as compulsory annuities were abolished.
There were distinct winners and losers in a Budget that Osborne said was designed to help beleaguered savers.
Hargreaves, co-founded by Peter Hargreaves (pictured), was one of the biggest beneficiaries. Its share price had been trending downward in morning trading, but spiked by 14.46% from 1302p to 1504p straight after the news after the chancellor unveiled plans to merge stocks and shares and cash ISAs with a raised annual allowance of £15,000.
However, his removal of an obligation to buy annuities as part of a dramatic overhaul of the pensions regime hit life companies hard.
Specialist annuities providers were the hardest hit. Partnership Assurance's share price slumped by a whopping 55%, while Just Retirement's shares dived by 42.4%.
‘A quarter of annuity sales are under threat as a result of changes to single pot triviality rules,‘ said Adrian Walker, retirement planning manager at Skandia.
'Today’s Budget announcement confirmed that consumers with pension pots of up to £10,000 are able to access their savings without having to buy an annuity. Our analysis of ABI data suggests that around 25% of annuity sales are currently for pension pots of less than £10,000.'