The SNP are today repeating calls for the UK government to set up an independent pensions commission as figures show that almost 200,000 people have dipped into their pension pot in six months – with two-thirds of retirees withdrawing their entire savings.
In 2014, Chancellor George Osborne announced a change in pension rules that would allow people aged 55 and over more flexibility about when and how to draw their pension savings and figures released by the Financial Conduct Authority show that half of those emptying their pension pot in the last six months of 2015 did so to give themselves an income.
Mhairi Black MP, the SNP’s representative on the Work and Pensions Select Committee, commented: “Individual savers have more freedom than ever when it comes to accessing their pension pot early and while that can be seen as a positive for many, it is extremely concerning that many retirees could be left facing undue hardship in later life.
“People can now dip into their savings from age 55 and according to the FCA figures more than half of those who completely emptied their pension pot did so to provide themselves with an income.
“A pension pot should help older people live out their retirement comfortably but it seems that almost 60,000 people are using their savings as a stopgap until they reach state pension age.
“The Tories need to act now to increase awareness of the effects of emptying a pension pot early can have on later life – the approaching retirement age or those who have already retired should not view their pension as a cash machine but as a guaranteed income for when they are elderly.
“The SNP has called on the Tory government to set up an independent pensions commission to investigate the impact of all these changes. The SNP brought the plight of thousands of women born in the 1950s who have lost out due to state pension age equalisation to debate in the House of Commons and received cross-party support for action from the Tories on pensions – and we will not stop until we get it.”