Winterthur Life has called on the Government to drop its opposition to alternatively secured pensions.
Pensions strategy manager Mike Morrison says clients who wish to beneftit from ASP show little opposition to the idea of inheritance tax on ASP funds as an acceptable price to pay for the extra flexibility.
But if the Government, as has been inferred, limits the product to those who have a principled religious objection to annuities, confidence in the new regime and saving could be damaged.
It has been suggested that the post A-day option of ASP could be subject to a review to determine misuse.
Morrison says: “If the government now tampers with the new regime, by restricting ASP only to those with a ‘religious objection to annuitisation’ as it has been reported, it will damage confidence and could destroy what is becoming a real opportunity to encourage future contributions. How can they police people’s religious beliefs? And who is to say who has an objection to
annuity pooling? This is a ludicrous state of affairs and it may even be
subject to legal challenge. The idea that ASP could just be available for those
of particular religious beliefs is disingenuous – from my experience
people are attracted to ASP because of the flexibility and the perceived
poor value of annuities.”