The volume of pensions transferred into annuities fell by 68 per cent in April, compared with transfers a year ago, according to the latest Origo figures.
The eCommerce standards and services body also found that in the three months since the pension freedoms took effect, overall pension to annuity transfers through its Options service were down by 58 per cent compared to 2014.
The transfer service handles around 95 per cent of the contract transfer market, automating about 40,000 transfers a month.
Paul Pettitt, managing director at Origo, said that the dramatic fall in the volume of transfers of people’s pension pots into annuities in the three months analysed, can be seen as a symptom of the change in the pension rules.
He said: “In the three months immediately following the chancellor’s bombshell Budget announcement in 2014, there was a 32 per cent fall off in transfers into annuities via the Option Transfers service.
“Volumes continued to steadily fall, although leveled out during November – and have been level since.”
Pension to pension transfers for April to June this year, on the other hand, increased 22 per cent compared to 2014.
Mr Pettitt added that despite the fall in pension to annuity transfers, the overall volume of pension transfers being handled by the Options service increased by over 19 per cent in the first half of the year, compared to 2014.
“The total number of firms using Options has risen to 50 (representing over 70 brands), with overall transfer times at around seven calendar days, up 1.5 days pre-April 2015.”
peter.walker@ft.com
