Pension changes welcomed

Fri, 14 Mar 2008

"Tens of thousands" of people will benefit from a reduction in costs for some pension accounts, one industry body has claimed.

Joanne Segars, chief executive for the National Association of Pension Funds (NAPF_, explained that proposals included in the budget will mean that those with a small amount of money in an occupational pension scheme will now be able to claim a lump sum, rather than a regular pension, without having to obtain details of other pension entitlements.

The change will affect any occupational pension scheme with a value of less than £2,000 and will move a "significant cost" from the process of obtaining a lump sum, she stated.

Ms Segars said: "We know that one of our larger NAPF member schemes has at least 1,500 individuals with a pension entitlement below the new 'trivial' limit, so we believe there are tens of thousands of UK pension scheme members who will also welcome [the] budget announcement."

The NAPF also said this week that occupational pension schemes offer benefits to both employers and employees.
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