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Pensioners at risk of poverty
GOVERNMENT pension reforms could lead many older people into poverty, Dave Watts has warned.
The St Helens North MP said he welcomed the Government’s acknowledgment that pensioners, who have been forced to take out an annuity, had often received very low levels of returns on their policies.
However, the Labour MP has claimed the decision by the coalition Government to allow retired people access to their entire pension pot could prove dangerous.
He said: “It could leave many pensioners in poverty in future years, if they entered into poor investments or spent the pension pots too quickly.”
Mr Watts has sought assurances that once pensioners have spent their pension pots, they will still be eligible for existing income related benefits in the future.
He also added that pensioners should wait to see the final details of the Government’s proposals and seek professional advice before they make final decisions on the future of their pensions, investments or spending plans.
The Labour MP added: “It is clear Government reforms will either lead to an increase in the overall welfare benefits bill, or they will leave many pensioners in poverty after they have exhausted their pension savings.”
In response, a spokesman from HM Treasury said: “We believe that people who have worked hard all their lives should have the freedom to decide how to use their savings.
“Those who have saved hard for a pension are taking responsibility in providing for themselves in their retirement, and the Government wants these savers to be trusted to make decisions about their future.
“The Government recognises that people will need support to make such significant decisions, which is why we are taking steps to ensure that everyone approaching retirement receives face-to-face, impartial guidance on their available choices.”
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