GAD rate review

SallyG

http://www.independent.co.uk/money/spend-save/drawdown-rule-changes-could-cost-pensioners-8571883.html

"The review is of government-set rates used by pension providers to determine how much income people can take each year and has been prompted by rock-bottom annuity rates and low gilt yields.

Pensions expert Ros Altmann says reversing the uplift as soon as next year would be "outrageous".

"The whole point of this was to give people who don't want to have to buy an inflexible and poor-value annuity the choice to take more of their savings when they want to," she says. "The Government already imposes too many restrictions on how much they can withdraw through income drawdown. Cutting this further would be a disaster." "


http://www.gad.gov.uk/Documents/Press%20Releases/2013/Technical_Bulletin_-_Budget_2013.pdf
"Pensions Drawdown
...... The Government announced in the Budget that GAD has been commissioned to review the pensions drawdown table and the underlying assumptions used to provide drawdown rates to make sure they continue to reflect the annuity market. "

Why do the drawdown rates have to reflect the annuity market?

jamesd

Just rumours but things like that make me wonder why this government is trying so hard to discourage people from using pensions for their retirement planning.

You need flexibility of income to do things like cover the years before the state pensions start and the cap levels before state pension age force you not to use pensions for that money because you won't be able to get it out of the pension pot.

It's crazy for a government that in theory is claiming to want to encourage use of pensions.

bilbo51

jamesd wrote: »

It's crazy for a government that in theory is claiming to want to encourage use of pensions.

For right or wrong, the government's main thrust is to cut cost in as politically expedient a way as they can get manage.