People won’t be able to dip into their pensions early. The Government had been consulting on the possibility of giving people access to their pensions before they retire. One aim of the proposal was to encourage younger people to save more by removing the disincentive of locking up funds for long periods of time.
However, following the consultation, Mark Hoban, the financial secretary to the Treasury, said that there was “limited evidence that allowing early access would have a positive effect on overall pension contribution levels or provide significant help to individuals facing financial hardship”.
Instead, the Treasury has decided to examine ways of introducing greater adaptability to the savings system. Mr Hoban said: “We will work with the industry to develop workplace saving to supplement pension savings. In addition, we will explore other ways of making pension tax rules simpler and more flexible, for example by making it easier to deal with small pension pots.”
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