Sister charities Help the Aged and Age Concern have called on chancellor Alistair Darling to think about altering regulations in the annuities market, which currently mean that pensions are reduced for some.
Employees reaching retirement with small pension funds are already being hit by low interest rates and the organisations believe that tax rules being applied to the cashing in of annuities are not helping.
A new joint report, called Coping with the Crunch: the Annuity Challenge, claims that hundreds of thousands of Brits suffering from redundancy or illness need to cash their pensions in early without the threat of their funds diminishing.
Andrew Harrop, head of public policy at Age Concern and Help the Aged, said: "The tax system penalises those with small pension pots and the annuities market is hamstrung by legislative complexity and dominated by a few major players."
Scottish Widows recently found that a quarter of women are stopping or reducing their pension contributions in order to concentrate on having and raising children.
Pre-Budget annuities shake up for better pensions, says Help the Aged
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Pre-Budget annuities shake up for better pensions, says Help the Aged
Mon, 07 Dec 2009
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