“However, we shouldn’t be celebrating prematurely as we are still seeing the nation’s youngest savers excluded from these benefits.
He added: “We also recognise that the next 12-18-months is going to be about businesses and individuals getting back on their feet. With the impact of AE having plateaued, now is the time for policymakers to focus on cohorts of the population, like young savers and those hardest hit by Covid-19, who are not yet benefiting from the current system and need effective solutions to help them save for the future.”
The ONS data also showed almost £10bn was transferred out of defined benefit pensions in the final quarter of 2019, up from just over £5bn in the previous quarter.
However, this data includes insurance buy-out deals as well as individuals quitting their DB schemes, which boosts the numbers.
Mr Selby said this means the figures are likely to “swing violently” when particularly large buy-out details are agreed.
He added: “The FCA recently announced a ban on ‘contingent charging’ in relation to individual DB transfers, while Covid-19 has led The Pensions Regulator to issue guidance to DB trustees saying they won’t take action if they don’t produce transfer values or ‘CETVs’ due to uncertainty caused by the pandemic.
“In the short-term, both will likely make it more difficult for individuals to complete DB transfers, with the FCA action in particular posing challenges for those with large pension funds but limited income.”
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