UK Politics

Minister: Retired 'could be given right to sell pension'

Picture of money in purse

Retired workers could be given the right to sell their pensions under plans floated by the pensions minister.

From April, working people will be able to cash in their pension savings for a lump sum when they retire.

Lib Dem Steve Webb said he wanted to extend this to existing pensioners.

Mr Webb said the plans were being drawn up by the Department for Work and Pensions, but said he did not yet have agreement from his Conservative coalition colleagues.

His plan would allow pensioners, if they wanted, to sell the annuities they had been required to buy under the old rules to the highest bidder.

This would allow them a lump sum to spend on what they liked, and could be used alongside other pensions they have accumulated, Mr Webb said.

He told BBC News his proposal would not be implemented by April when the changes affecting working people, announced in Chancellor George Osborne's 2014 budget, come into force.

He said: "To be honest, I would hope that all parties will say that people who have worked hard and built up a pension pot should be given the freedom to do what they want with it, rather than have the government tell them how to spend their own money."

Image caption Steve Webb said he hoped to publish some proposals before the election

Mr Webb has previously said pensioners should be free to spend their pension savings on a Lamborghini if they wish.

Under the changes previously announced, people reaching retirement age will no longer have to buy a guaranteed annual income, in the form of an annuity.

Labour has said it supports that move in principle, but said scrapping the requirement to take out an annuity altogether was a potentially "reckless and irresponsible" move, which could "leave people running out of money".

Mr Webb said the people affected by the changes were "the opposite of irresponsible" as they had already saved hard to build up a pension.

"It should not be the government saying 'we insist you take your retirement income in one particular way'," he added.

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