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Three quarters back new partial DB transfer rules

Nearly three-quarters of Money Marketing readers believe that defined benefit pension schemes should have to offer partial transfers.

While current rules allow individuals to take part of their final salary pots, many trustees and employers are reluctant to offer partial transfers over fears of administrative difficulties, even though they can reduce their DB scheme’s liabilities and give more flexibility to members.

Anecdotal evidence suggests that few providers are currently offering partial transfers. Key pensions industry figures such as former pensions minister Steve Webb, Fidelity head of pensions policy Richard Parkin, Hargreaves Lansdown head of retirement policy Tom McPhail and providers including Aegon have all come out in support of partial transfers.

Most recently, Standard Life argued that new rules should be introduced to make sure advisers take into account partial transfers when making their recommendations on DB transfers.

What next for DB pension transfer advice?

In a poll of 141 Money Marketing readers, 73 per cent agreed that DB schemes should have to offer partial transfers. 24 per cent said they should not be forced to allow consumers to give up part of their guaranteed incoming, and the remaining three per cent were undecided.

Pensions technology provider Origo says that conversations around partial transfers are one of the factors that are likely to fuel further DB transfers into the future.

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Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Robert Milligan 9th August 2017 at 4:50 pm

    Of course PRODUCT PROVIDERS want this, they want a part of a big cake, as clearly, they are getting less and less currently, so based on final salary, which years are you going to transfer out, this is worse than the Second Hand annuity idea, Why should the current schemes be made to do this additional work We must not forget, the viability of DB schemes relies upon mortality, if you keep allowing money to be transferred out, the Cost of these schemes will create a bigger problem than the Funding of the State Pension

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