12 October 2006
Earlier this year, as part of its pension simplification plans,
the government introduced new investment freedoms for pension
funds.
Now, only a few months later, it is threatening to clamp down on
one of these new freedoms, and possibly to remove it.
The reason for this is that the government claims the new rules
are only intended to be used by a Christian sect.
The government believes that the new rules are being used
instead by wealthy people, and that this is an abuse of the
system.
The specific rules which are causing the problem, are those
which mean that you no longer have to buy an annuity with your
pension fund at retirement.
Instead of handing over your savings to an insurance company in
exchange for a guaranteed income for life - an annuity - you now
have a choice.
