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MP tables Parliamentary question over income drawdown rules

London UK Thames Parliament 480

A Northern Irish MP is calling for more political pressure to force the Government into a review of income drawdown rules ahead of the autumn statement on 5 December.

Democratic Unionist Party MP for East Londonderry Gregory Campbell tabled a written question in the House of Commons on 19 November asking chancellor George Osborne what plans he has to review the drawdown regime.

The convention is that an MP will receive an answer within seven days but there are no guaranteed rules.

Savers in drawdown have seen their retirement incomes fall as gilt yields, which are used to calculate the maximum annual income people can take under capped drawdown, have fallen to record lows.

It follows the Government’s move in April 2011 to reduce the annual income limit for capped drawdown from 120 per cent of GAD to 100 per cent.

AJ Bell, Standard Life and Partnership have been among those calling for Government to revisit rules but it has so far resisted the pressure.

But Campbell says the Government’s record of U-turns shows it is susceptible to political pressure from MPs.

He says: “The concern is that with annuity rates being reduced significantly people are feeling the pinch considerably. If drawdown rates are restricted then it also results in reduced payments for pension pots.

“There has to be a review and if enough MPs raise concerns then there will be. As we have seen on a number of issues if there is enough pressure then we can force the Government into a rethink. Hopefully that will be the case on this occasion.”

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  1. Good man yourself Gregory.

    The tired civil servants at HMRC and the FSA who set the rules for others are a million miles away from their effects with the Final Salary benefits they enjoy.

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