Debbie Abrahams MP, Shadow Work and Pensions Secretary, responding to the publication of the Association of British Insurers’ (ABI) findings on the first full year of the Tory Government’s Freedom and Choice pension reforms, said: 

“Whilst it’s welcome news that only a small minority of savers are withdrawing too much from their pension pots the real story is the Tory Government’s failure to ensure workers have independent, good quality advice which enables people to make informed decisions about their retirement needs.

“There is a real risk that Tory complacency will lead to our next pension crisis, a crisis based on people finding themselves short of money in their retirement as a result of insufficient advice being available to enable people to effectively manage their pension pots.

“The Tory Government’s kowtowing to the pensions industry demonstrates yet again where the Tories’ priorities lie. We urgently need a comprehensive solution to the pension’s crisis; we need to have regulation that requires all pension investment costs to be made transparent, collective defined contribution or CDC, and we need scale in asset size for pension funds in general.”

Ends

Notes to editor

         •  A full breakdown of the ABI’s data can be accessed on here - https://www.abi.org.uk/News/News-releases/2016/08/ABI-pension-freedom-statistics-factsheet-April-2015-April-2016

         •  A typical pension pot is £35,000. This amount would buy approximately £20 a week, or £1,040 per year inflation index-linked or £32 a week, £1,664 per year flat-for-life pension annuity. According to the Treasury a worker now needs a pension pot of £275,000 to buy an index-linked pension at 65 equalling the new state pension of £8093. [Paul Lewis of BBC Moneybox]

         •  A 2% fee annual fee levied against the value of your pension pot will take out 60% of the value over a 30 year lifetime, if these costs were capped at 1% then we can add back 30% to the value of people’s savings. [Unison]