Pensions Proposals
Paul Lewis reported in the August issue about the Government's White Paper on pensions, here are some of our Saga readers' feedback in response to this reform One reader writes:"More flexibility should be allowed for setting up joint annuities for married couples. Legally and morally, partners should be entitled to equal treatment on first death of either partner. Under the present rules, a compulsory annuity does not allow a reduction of the annuitant's income on death of the dependant spouse, however a reduction can be applied for the spouse if the annuitant dies first. The only equal option available under the current rules is for a "100% joint" annuity, which gives a significantly reduced joint income with no reduction on first death. It ought to be possible to have an annuity which reduces to, say, 75% on first death of either partner. This would give a higher level of joint income that the 100% joint annuity and may be more advantageous to the couple. Further desirable options would be the ability to pool or divide the pension funds between partners so that the best choices of separate single-life or joint annuities could be selected. This could have tax advantages. I understand divorced couples can do this, so why not everyone?" Audrey Ward writes:"Whilst the basic pension proposals are all good, albeit a bit late in coming, there is little encouragement for anyone to save extra for their retirement by way of "personal account" or by personal savings while the bogey of having to pay for long term care still hangs over us. Those presently having to pay for their care, or that of their partner from life savings, will surely advise their children not to bother." Ada Varley writes:"I am a member of the Civil Service Pensioners' Alliance which has been campaigning for the re-institution of the link with earnings ever since it was removed. We are pleased to see that the Government has at last given a nod in the right direction, but we deplore the fact that nothing is being done for present day pensioners. Great numbers of us will not be around to benefit, given the forecast of when the proposals are likely to be implemented. The Alliance is joining the National Pensioners Convention to press for a state pension of £114.05 per week for a single pensioner, to be paid now and to rise annually in line with increases in average earnings. We believe that, in spite of the Government protests, the money is there to implement this."
This article was created: 16 August 2006.
This article was last edited: 13 November 2006.
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