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Clause 9 - Retirement income funds

Part of Rights of Savers Bill – in a Public Bill Committee at 3:30 pm on 14th December 2005.

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Photo of Nigel Waterson Nigel Waterson (Also PPS To the Chairman of the Party), Work & Pensions & Welfare Reform 3:30 pm, 14th December 2005

We entirely support the proposals, which are very much in line with—indeed, a refinement of—provisions in a series of private Members’ Bills presented by Conservative Back Benchers. They are a recognition that, in this day and age, there is a feeling that compulsory annuitisation, up to the age of 75, is outdated and unfair, and often brings very limited returns. We are almost the only developed country where it is still a legal requirement.

With all the conditions that my right hon. and learned Friend has explained in detail about ensuring that the Treasury will not be losers the clause seems to us to be the way forward. I believe that the Government see that, because they try constantly by spin to show that that their alternative secured pensions proposals achieve just the same. Of course, they do not. We need a clear, coherent proposal, like that in the clause, which sweeps away the obligation to annuitise at a certain age and gives people the flexibility that is so important. I hope that such a proposal will, in the longer run, play its part in encouraging people back into savings, which we badly need to do if we are to begin to deal with the pensions crisis.