Cap on pensions charges mooted

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Published: Wednesday 17th June 2015 by The News Editor

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The Government is considering a cap on the amount savers are charged to withdraw money from their pensions, the Chancellor has said.

George Osborne said there were “clearly concerns” that some companies are not doing enough to make the new freedoms, introduced earlier this year, available.

Standing in for David Cameron at Prime Minister’s Questions, he told MPs: ” The pensions freedoms we introduced in April deliver a fundamental Conservative principle that people who have worked hard and saved hard all their lives should be trusted with their own money.

“There are clearly concerns that some companies are not doing their part to make those freedoms available.

“We are investigating how to remove barriers and we are considering now a cap on charges. I’m asking the Financial Conduct Authority to investigate.

“People who have worked hard and saved hard deserve a better deal.”

He was responding to new Tory MP Nigel Huddleston (Mid Worcestershire), who asked: “Will you do all you can do to make sure that the industry lives up to its side of the bargain and delivers on those freedoms?”

Yesterday, Mr Osborne announced that some 60,000 people had already made use of the changes, transferring more than £1 billion out of pots.

The reforms mean savers can spend their pension as they like without facing large charges, although not all providers are yet offering all of the options, which include withdrawal of a lump sum.

Published: Wednesday 17th June 2015 by The News Editor

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