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Pension transfers increase 19% in 2016

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Origo conducted £25bn worth of pensions transfers in 2016, a 19 per cent rise on the previous year.

The technology provider has now transferred more than £100bn since its Options Transfers service launched in 2008.

The volumes have increased for the past three years from £17bn in 2014 to £21bn in 2015 and £25bn last year.

Orgio says this trend is unlikely to slow given the introduction of pension freedom legislation in April 2015.

It predicts there are three other drivers that will fuel further transfers. First is new FCA rules ensuring that annuities offered by product providers internally to pensions holders are made available on the open market. Origo says this might result in more movement in the market as customers seek to obtain better terms.

Second, is the three-year anniversary of the first companies to go through auto-enrolment and whether more companies will seek more cost effective solutions.

Third, current discussions around allowing partial DB transfers.

Origo managing director Paul Pettitt says: “With a partial transfer, sufficient entitlement could be retained in the scheme pension to provide a suitable income for life, while the rest of the pension could be moved to defined contribution arrangement, to take advantage of more flexible products and other benefits of the pensions freedoms, such as the new death benefits allowing pensions money to be passed down the generations.

“Should partial transfers be sanctioned, it would provide the scope for considerably more transfers to take place.”

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. This is all very well, but I’m finding that even a recently retired IFA can’t transfer a smallish final salary pension without having to take full advice!! Does anyone know of a way around this? Please let me know if there is one.

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