Text entered

Government publishes response to its call for evidence on early access to pension savings

Government Communications (NDS)

19 April 2011

The Financial Secretary said:“The Government is committed to encouraging saving and wants to give individuals greater flexibility in saving for retirement. While early access has some merits, there is insufficient evidence to suggest it would act as an incentive to save more into pensions. We will work with industry to develop workplace saving to supplement pension savings. In addition, we will explore other ways of making pension tax rules simpler and more flexible, for example by making it easier to deal with small pension pots.”The Government will announce further details on the reform to trivial commutation rules for small personal pension pots in the autumn.1. Over 100 responses were received, including from over 60 organisations representing major pension providers and schemes, consumer bodies, think tanks and other financial service providers.2. The summary of responses to the call for evidence on early access to pension savings is available at: http://www.hm-treasury.gov.uk/consult_early_access_pension_savings.htm3. Currently, individuals can only access savings in a registered pension scheme from age 55 at the earliest (except in cases of serious ill-health or other limited circumstances.)4. The response period opened on 13 December 2010 and closed on the 25 February 2011. 5. The Department for Work and Pensions estimate that around 7 million working age people are currently under-saving for retirement.6. The current small pot trivial commutation rule allows pension funds of less than £2,000 in an occupational pension scheme to be paid out as a lump sum (subject to further conditions).7. Feeder funds are products that link an ISA to a pension, for example by having a threshold above which liquid savings are automatically rolled over into the pension part of a product.Non-media enquiries should be addressed to the Treasury Correspondence and Enquiry Unit on 020 7270 4558 or by e-mail to public.enquiries@hmtreasury.gsi.gov.uk This Press Release and other Treasury publications are available on the HM Treasury website hm-treasury.gov.uk For the latest information from HM Treasury you can subscribe to our RSS feeds or email service.To subscribe to the Treasury's press notice mailing list send an email to Press List with the words SUBSCRIBE PRESSLIST in the subject field. To unsubscribe from the mailing list email Press List with the words UNSUBSCRIBE PRESSLIST in the subject field.Media enquiries should be addressed to the Treasury Press Office on 020 7270 5238.