The “pensions freedom” regulations, which were introduced by George Osborne in 2015, could be reversed by financial regulators. The FCA (Financial Conduct Authority) is releasing an interim version of a report on its investigation of how the retirement income market has changed in recent years. This includes strong concerns about the way the reforms are being used.
CityAM reports –
“In its interim report released today the FCA said drawing down from pension pots early had become “the new norm” and warned over half (53 per cent) of pension pots accessed early had been withdrawn fully… However, over half of these people are not moving the money to other savings or investment products. Some of was “due to a lack of public trust in pensions”. “Since the introduction of the pension freedoms, the retirement income market has changed substantially,” said FCA executive director of strategy and competition Christopher Woolard… “This study looks at what has happened during this time, and gives us an early view of areas to keep a close eye on. We have identified areas where early intervention may be needed either now or further down the track to put the market on the best footing for the future. Ensuring this market works well will require cooperation across government, regulators, the industry and consumer bodies.”