The Pensions bill is currently in the House of Lords at the committee stage and hot topic of discussion is the treatment of protected rights.
The new legislation means that people who are married, or have a civil partnership, will still be required to purchase a 50 per cent spouse pension with their protected rights portion of their policy. This will still apply even after the money-purchase contracting out ends in 2012.
Our view
This will still mean that pension pots cannot be combined to buy one annuity, and the difference between protected and non-protected rights will still have to be discussed with the client. This is a lot of unnecessary red tape.