Warning over 'burden' of reformed pensions

The Treasury has dismissed warnings that pensioners could be left at greater risk from 'poor decisions' following the major reforms to retirement savings announced in yesterday's Budget.

Latest ITV News reports

'Seething in the City' over Chancellor's annuity reform

ITV News Business Editor Joel Hills wrote on Twitter:

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I spoke with the boss of a big annuity provider last night. He clearly had no idea this was coming.

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Annuity reform a big story. Share prices of big providers taking a soaking. Chancellor did not consult on this. Seething in the City...

During his Budget speech, Chancellor George Osborne announced several changes to pensions, including options to allow some pensioners to avoid taking out an annuity.

Citizens Advice welcomes Osborne's pensions change

Citizens Advice has welcomed the Chancellor's proposals on pensions in his Budget speech.

Citizens Advice chief executive Gillian Guy said after the announcement: “The proposals to free up pensions are welcome, particularly the new ‘right to advice’, which recognises the significant value of impartial, trusted advice.

File photo of a sign above a Citizens Advice Bureau in Nottingham.
Citizens Advice welcomed George Osborne's proposals 'to free up pensions'. Credit: Rui Vieira/PA Wire

“People who are able to put money aside into savings will find an increase in how much they can save tax free helpful.

"But the Chancellor does need to remember that for many people, saving money is a pipe dream as they are struggling to make ends meet."

Explained: How private pensions are changing

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Pensions firms and insurers 'in a spin' over reform

ITV News Business Editor Joel Hills wrote on Twitter:

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Pensions companies and insurers Ina spin over annuity reform. So took are share prices: Aviva down 8%, Legal and General down 11%. Oops!

The drop in share prices follows Chancellor George Osborne's Budget announcement that included several changes to pensions, including options to allow some pensioners to avoid taking out an annuity.

Pensions providers see shares hit after Budget

Pension providers have seen their share price fall in the wake of a series of announcements from the Chancellor affecting the industry.

George Osborne with his Treasury team ahead of the Budget.

The latest figures from the London Stock Exchange show drops in share prices across major providers.

Legal & General -10.7%

Aviva -7.66%

Standard Life - 3.28%

Prudential -2.67%

Read: Chancellor announces private pensions revolution

Pensions reform at a glance

George Osborne announced several changes to pensions including options to allow some pensioners to avoid taking out an annuity.

  • Reform of taxation of defined contribution pensions to help 13 million people from 27th March.
  • New Pensioner Bond paying market leading rates to be available from January to all over 65s, with possible rates of 2.8% for one-year bond and 4% for three-year bond.
  • Tax on cash taken out of pension pot on retirement to be reduced from 55% to 20%.
  • All tax restrictions on pensioners' access to their pension pots to be removed, ending the requirement to buy an annuity.
  • £20 million fund to develop new free right to advice for those retiring on defined contribution pensions.
  • Abolition of 10p starting rate of tax on income from savings.

Read more: Osborne promises Budget for 'makers, doers and savers'

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'Massive' announcement on pension annuities

by - Economics Editor
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Osborne now reacting to complaints about annuities pensioners have to buy: no need to buy one anymore. This is massive.

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New pensioner bond offering 2.8% for 1 year bond and 4% for 3 year bond. Again for Tory-voting pensioners

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Multiple changes to people's pensions, basically giving them more flexibiity. 'No one will have to buy an annuity.'

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