Tag Archives: lock

Pension UK: Minimum retirement age extension loophole discovered – how to ‘lock in’ at 55

Minimum retirement age extension loophole discovered

Pension ages differ between private schemes and state pensions, as retirees can only claim the latter from the age of 66. For private plans, it is possible to access funds from the age of 55 but earlier this year, the Government announced plans to increase this to 57 over the coming years.

The responses were wide ranging but they covered a number of areas such as how the overall framework should be considered, analysis of pension scheme rules and how members should be informed of the changes.

The Government went on to break down its planned next steps on the matter: “Raising the NMPA is necessary to reflect long-term demographic changes and reflects the changing expectations of how long people will remain in work and in retirement. The Government intends to publish draft legislation for a protection regime now and to legislate for this rise to 57 in the next Finance Bill.

“As appropriate, HMRC will provide further explanation and examples within its guidance for what is an unqualified right. The Government also acknowledges the importance of establishing a clear position on the transitional arrangements.

“For example, members who do not have a PPA and have reached age 55 but not age 57 by April 6, 2028 and for whom a transitional issue may arise. The Government will provide further advice on the proposed transitional arrangements and provisions in due course

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Canada Life examined the consultation and broke down what the new rules will mean going forward:

  • The normal minimum pension age will increase from 55 to 57 in 2028 (in line with the increase in state pension age to 67).
  • Members of “Uniformed pension schemes” including armed forces, police and fire services, will retain a normal minimum pension age of 55
  • An individual member of a registered pension scheme who on April 5, 2023 has a right to take benefits from an earlier age than 57 and the rules of the scheme on 11 February 2021 (the date of the original consultation) gave a right to take benefits at an earlier age, can retain the right to take benefits at age 55
  • That right to take benefits at an earlier age is retained on a ‘block transfer’ – broadly speaking a block transfer is where two or more people transfer from the same transferring scheme to the same destination scheme at the same time

Andrew Tully, a Technical Director at Canada Life, responded to the findings.

Mr Tully said: “The confirmation of the timing of the increase in the normal minimum pension age will be welcome to individuals and advisers and give time for appropriate planning over the next seven years. However, what should have been a simple process has turned into a hugely complex mess. “The process to decide which individuals retain a right to an earlier pension age is completely arbitrary, being based on the specific wording within scheme rules, which may have been written many years ago.

“It also leaves open the possibility that people will hunt around for a scheme which gives them the right to take benefits at age 55 and transfer to that before 2023. “So expect frantic transfer activity over the next few years as people look to secure age 55 as their minimum pension age, irrespective of their birth date.

“It is also disappointing to see a continuation of the existing ‘block transfer’ rules. These rules are complex and can effectively stop individuals transferring to a more modern, flexible, cheaper contract simply because they want to hang onto this right to take benefits at age 55.

“The legislation as drafted adds further hideous complexity to the pension system, which might be fine for pension geeks like me but for the average pension saver will prove nigh on impossible to navigate successfully without the help of a professional adviser.”

Steve Webb, a partner at LCP and former Minister for Pensions, also examined the consultation and in doing so, uncovered an important potential loophole.

Mr Webb explained those who are already 57 will not be overly affected by the changes but the news will still be important to those who are “roughly” under 50.

Those who fall into this bracket may still be able to “lock in” their retirement ages at 55, as Mr Webb explained: “[HM Treasury] have announced today a potentially important loophole. “If you can find a scheme which had age 55 ‘written into the rules’ when they were published in February 2021, you can join it as long as you do so by April 2023!

“And the money you put in, plus subsequent savings, will all be accessible at age 55 even after 2028.

“For those who care about whether they can access their money at 55 or 57 after 2028 this is important. They should:

  • Find out whether the scheme they are already in has a baked in age of 55 or if it will rise to 57 in 2028;
  • Think about whether it might make sense to save somewhere else, and – subject to other considerations as well, like charges, investment performance, exit fees etc etc – potentially even transfer existing savings into ‘age 55’ schemes.”

Mr Webb concluded by providing guidance on where savers should start to lock in their pension ages: “We have known for some time that the government was planning to raise the standard minimum age for accessing a pension from 55 to 57. But today’s announcements provide a window for people to lock in to age 55 if they wish. Schemes which already have a right to access at 55 written into their rules will have this protected even after the 2028 change, and other savers may be able to join such schemes. As a first step, pension savers should find out where their own scheme stands. If their own scheme’s access age will rise to 57 they may wish to review where they hold their pension savings”.

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This post originally posted here Daily Express :: Finance Feed

State pension warning: Rishi Sunak ‘considering changes’ to triple lock – tax raid fears

Chancellor Rishi Sunak is looking to raise funds to help the UK economy recover from the coronavirus pandemic. Reports in recent months have been rife with speculation over which taxes could be hiked or reformed to help raise cash for the Treasury. One change that has been hinted at by Mr Sunak himself is making changes to, or even abolishing, the pension triple lock. The triple lock works as follows.

At present, the state pension increases each year in line with the rising cost of living seen in the Consumer Prices Index (CPI) measure of inflation, increasing average wages, or 2.5 percent, whichever is highest.

Average earnings have been the key part of the debate in recent months – official forecasts suggest that average earnings will be the highest of these three, by a considerable margin.

Predictions by the Bank of England suggest that average earnings could go up by 8 percent.

This has sparked concerns that young people who have suffered from unemployment or wage reductions during the Covid crisis may end up paying more for state pensions of older citizens.

Pension expert Steve Cameron has told Express.co.uk that Mr Sunak will probably have to at least partially break his 2019 manifesto pledge to maintain the triple lock.

He said: “The Conservatives vowed to keep the triple lock in 2019, but quite clearly at that point we were about to have a pandemic. The world has changed.

“When something significant changes, I’m not suggesting you should give up manifesto pledges without serious thought, but sometimes for fairness you might need to make changes.

“I would be surprised if Rishi isn’t at least considering changes.”

Mr Cameron explained that the Chancellor won’t want to make drastic changes, but will nevertheless want to ensure the system is made fairer.

READ MORE: Sunak condemned for planned assault on pensioners’ savings

He highlighted certain impacts of the pandemic have affected pensions, and how Mr Sunak could seek to correct this.

Mr Cameron continued: “I think he will want to stick to the spirit of the triple lock, so I don’t think for a minute he will scrap it entirely.

“I think he will try and adapt the triple lock given the way earnings have moved. He could possibly smooth the earnings figures over two years or maybe even three years.

“An alternative is to strip out the effects of the pandemic on national average earnings growth, and that’s the one that has been talked up in recent months.

“The Office of National Statistics (ONS) last month produced its earning figures, and showed what earning growth would have been if you stripped out furlough and it also considered that most jobs lost during the pandemic were lower paid jobs.

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“This month, they also gave an indication of how earnings have moved over two years – they have gone up by 7.1 percent, but over the last year, it has been 8.6 percent.

“There will be an adjustment, it will be to use the average figures or take out the distortions caused by furlough and the pandemic.”

The Telegraph revealed last month that Treasury officials were looking at three major reforms to how pension contributions are taxed to cover heightened pandemic spending.

But there was push-back from some senior Tories to the ideas being pursued, in a reflection of how politically challenging major pensions reforms would prove.

One minister with an economic brief stressed that Conservatives should be encouraging people to put into their pension pots rather than making changes that could discourage it.

The source told The Telegraph: “Anything to do with pensions, because it’s such a long-term gain, we have to proceed with caution. If we do anything radical you need to build consensus across Parliament.”

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This post originally posted here Daily Express :: Finance Feed

State pension triple lock: DWP has ‘no plans’ to remove freeze on pensions for UK expats

In December, the Group detailed the Governments from Canada and Australia, two countries with among the highest numbers of excluded British retirees, had submitted damning evidence which condemned the policy.

According to evidence examined within the report, both of these governments have confirmed a readiness and willingness to work with the UK Government to end this policy but emphasis was placed on the fact that the issue can be resolved by UK domestic legislation.

It was highlighted both Canada and Australia provide full state pensions to their pensioners who live in the UK, with the UK being the only country in the OECD to pay their pensioners differently based on where they live.

At the time, representatives for the Canadian Government issued the following statement: “Over the years, the Government of Canada has raised, and has sought to address, this issue with the UK, including by proposing the two countries negotiate a comprehensive social security agreement that would provide for the indexation of UK pensions.

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This post originally posted here Daily Express :: Finance Feed

Pension POLL: Should triple lock be broken if pensions rise 8% under rule? VOTE

State pension payments offer support to older people who are eligible to receive the sum from the Department for Work and Pensions (DWP). To receive the payment, individuals must put forward a set number of National Insurance contributions throughout their lifetime. For many people, then, the state pension serves as a primary source of income in retirement, particularly useful when the regular payment of a salary or wages is lost.

Understanding the importance of a state pension to millions of Britons, the Triple Lock Mechanism is in place to protect the sum.

First introduced in 2010 by the then-coalition government, the mechanism is designed to protect the state pension in real terms.

Triple Lock sees the basic and new sum rise by the highest of three key components: average earnings growth, inflation or 2.5 percent.

For this tax year, the sum increased by 2.5 percent, but there has been discussion about the pending increase for the forthcoming year.

READ MORE: State pension: Warning as ‘low’ sum leaves millions at risk

While this has led some pensioners to celebrate a potential boost to their sum, there is concern in other camps.

Mainly, there has been a suggestion that the Triple Lock policy is not viable, and with increases set to be high, some have said it should be scrapped altogether.

Such an increase, it has been argued, is unfair for younger generations, many of whom have been impacted by the pandemic.

Others have suggested a modification to the policy, perhaps a ‘double lock’ or a temporary freeze to ensure the longevity of state pension support.

Recently, the Chancellor Rishi Sunak was pressed on whether the policy would be maintained in the future.

GB News presenter, Andrew Neil, questioned the Government’s stance on the matter.

Mr Sunak responded: “Of course the triple lock is still Government policy. 

“I think formally, I have to be very careful, as I can’t comment on fiscal policy outside of events, which I’m sure you’ll understand.

“With regards to pensions uprating, there is a statutory review which is carried out later on in the year, which is then brought to Parliament.

“What you’re referring to are forecasts, but as we’ve seen over the past 12 months, we’re in a period of extraordinary economic uncertainty, and lots of the forecasts we’ve seen have moved around and changed.

“I’d put that in the bucket right now, that’s speculation, and when we get to the autumn, there will be a formal review.”

This post originally appeared on Daily Express :: Finance Feed

State pension triple lock ‘will be broken’

GB News presenter and Economic Editor Liam Halligan argued that he believes the state pension triple lock will be broken. He argued that Rishi Sunak was being unclear at a time where the public demanded certainty. He argued that if the triple lock was not broken it would spark fierce questions on inter-generational unfairness.

He noted that due to the Covid pandemic, the Government could be forced to give pension a 6-8 percent rise while the young people of the country suffer.”

Mr Halligan said: “I think the electorate would respect Rishi Sunak more if he treated them like grown-ups on these big issues.

“Michael is right, I think the triple lock is going to be broken.

“On my show with Gloria De Piero, earlier today on GB News, we had Guy Opperman on, the Junior Pension Minister and he used almost the same form of words when Gloria and I put to him are you going to maintain the triple lock.

“Look, you are going to end up giving pensioners a 6,7, 8 percent rise at a time, as you said to Rishi Sunak Andrew, there is a very big and legitimate set of questions about intergenerational fairness.

“It is the young who have endured this huge burden of this lockdown, not just in terms of mental health but in so many other ways.”

Mr Halligan some advice on how best to prepare the public for the Government to break the triple lock.

He said: “I think he needs to start preparing the electorate for lest they feel as if they were fools.

When asked if the triple lock was still Government Policy Mr Sunak answered: “I think formally, I have to be very careful, as I can’t comment on fiscal policy outside of events, which I’m sure you’ll understand.

“With regards to pensions uprating, there is a statutory review which is carried out later on in the year, which is then brought to Parliament.

“What you’re referring to are forecasts, but as we’ve seen over the past 12 months, we’re in a period of extraordinary economic uncertainty, and lots of the forecasts we’ve seen have moved around and changed.”

This post originally appeared on Daily Express :: Finance Feed

Paisley emergency: Police rush to lock down street after incident near polling station

Photos from nearby Broomlands Street show several police cars blocking the street and directing people away from the street. One eye witness described it as a “major incident”. It is not yet known what the police are responding to or if the polling station, Maryrs Church Hall, has been closed.


Locals took to Twitter to report the incident, with one person writing: “Some kind of major incident at well street in Paisley.

“Several police vans, cars and several incident support unit outside a polling station.”

They added: “Just we had to pass it by en route and it was a pretty scary sight!

“Cldnt [sic] see anything as road completely blocked by so many vehicles.”

Another person wrote: “Anyone got any idea what’s happened on Broomlands Street at the Church/Polling Station?

“Police everywhere directing traffic away from the street.”

Express.co.uk has contacted Police Scotland for a comment.

Scots head to the polls today to elect the new members of Holyrood. 

The SNP is on course to win a fourth term in office, but it is not yet clear whether they will secure an overall majority.

Voters will head to the polls on Thursday, May 6, from 7am to 10pm.

Anyone who is aged 16 and over is eligible to vote in the election.


This post originally appeared on Daily Express :: UK Feed

SHELTER IN PLACE: Northwest Austin apartment complex residents asked to stay inside, lock doors

Author: Russell Falcon
This post originally appeared on KXAN Austin

AUSTIN (KXAN) — Residents of the Hendrix Apartments on 9815 Copper Creek Drive are being asked to stay inside their homes and lock the doors on Tuesday afternoon after reports of a barricaded person in the area.

Williamson County reports local law enforcement has enacted a shelter in place notice at 10:18 a.m. for the vicinity. The reason for the notice hasn’t yet been reported.

Residents should stay inside until given further notice. Community members should also avoid the area as Williamson County Sheriff’s Office and Austin Police Department respond.

KXAN will update this with more information as it becomes available.