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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 John Penrose John Penrose Conservative, Weston-Super-Mare 3:30 pm, 14th December 2005

The amendments seek to alter the Bill with one important change. The Bill states that

“an authorised Retirement Income Fund provider must set an annual maximum withdrawal allowance for each member, based on an assessment of each member’s life expectancy, and a member’s withdrawals from the fund in any one year must not exceed that allowance.”

If, having set up a retirement income fund, someone is diagnosed with a serious illness and their life expectancy dramatically shortens, it is in their interest and that of public policy to increase the maximum amount they are allowed to withdraw.

The amendments seek to allow for the maximum amount to be regularly reassessed in line with their shortened life expectancy, so that they are not short-changed by the bureaucracy.