The Government has dropped plans to create a secondary market for annuities following consultation.
The original proposal was intended to extend the pensions flexibilities introduced from 6 April 2015 by removing the rules which deter individuals from assigning or surrendering rights to receive payments under pension annuities.
Following consultation and discussions with the pensions industry and regulators the Government has announced they will not be taking these plans any further.
This is on the grounds that it would be too difficult to balance consumer protections with the creation of a competitive market:
- The market was likely to be limited and small due to a lack of willing purchasers, meaning individuals would not get good value.
- The steps that could be taken to generate more purchasers would undermine consumer protections.
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The Government press release can be found here