LONDON (Reuters) - Britain cancelled a plan to create a secondary market for annuities on Tuesday, dismantling a key part of former finance minister George Osborne’s drive to allow pensioners more freedom to choose how to invest their pension pots.
Last year, Osborne announced pensioners would no longer have to buy an annuity, or an income stream for life, with their pension savings. Instead, they would be able to buy more flexible retirement products or take their savings in cash.
But on Tuesday, the finance ministry said creating a market for annuities posed risks to pensioners and it was clear there would not be enough purchases to create a competitive market for annuities.
“It has become clear that we cannot guarantee consumers will get good value for money in a market that is likely to be small and limited,” said Simon Kirby, a junior finance minister, in a statement.
Reporting by Andy Bruce; editing by William Schomberg