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Lack of drawdown controls concerns shadow minister

Shadow pensions minister Gregg McClymont has expressed concern over lack of pension drawdown controls and the Governments plans for a single pensions regulator.

MClymont has said that the Government have “not thought at all” about how drawdown will work, and there have been no guidelines on how they would regulate it if it became the dominate form of retirement income. To drawdown your pension is to keep it invested and withdraw money as and when you need it, rather than buying an annuity.

The shadow pensions minister also believes that the current governments plans to move toward a single pensions regulator may not be the right way to proceed, as the benefits of this have “not been proven”.

When speaking about drawdown controls, McClymont said:

“We are going from annuitisation to a much more flexible drawing down of pensions savings. In terms of pension schemes, an area the Government has not got to at all yet is how drawdown will apply there.
“As drawdown emerges as the dominant form of decumulation from pension schemes, I worry that’s something that has not been thought about at all.”

In relation to a single pensions regulator, he said:

'The debate over a single regulator is one which I think continues to rumble. In my own view, at this stage, is that the case is not proven.
'It is something certainly which I continue to take representations on and look at the issue of whether a single regulator would be a way to proceed.'
This comes after a report from Fidelity Worldwide Investment has found that half of people retiring next year under the new pension freedoms have not begun to assess their options.

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