The government is unlikely to listen to the industry's concerns about its plans to raise the normal minimum pension age, providers have said.
Draft legislation introduced last year to increase the NMPA will complicate the pensions landscape, but this is unlikely to be changed in 2022, according to Andrew Tully, technical director at Canada Life.
The government proposed the NMPA will increase to 57 in April 2028 and had originally given people until April 2023 to either join or transfer into a scheme which could offer a protected pension age.
But in November it U-turned and closed this window without prior notice. The last accepted applications for transfer had to be made before midnight on November 3.
The pensions industry said complexities brought about by the age change itself would remain where people in a scheme with a protected pension age and later transfer might end up in a scheme with two different NMPAs.
Tully said: “What should have been a simple process has allowed some people in certain schemes being allowed to protect a minimum pension age of 55. However, this depended on the wording of scheme rules on February 11, 2021, so was an arbitrary position rather than one targeted at a specific group of individuals.
“This is draft legislation but chances of any changes are fading into the distance. Although I still believe the NMPA should either be moved to 57 for all, with very limited exceptions, or the government should retain age 55 and re-think its entire policy around minimum pension ages.”
Stephen McPhillips, technical sales director at Dentons, said the legislation could change again as it has already gone through two amendments.
McPhillips said: “Unless it is substantially altered, the draft legislation will further complicate the pension landscape, meaning that perhaps more than ever, clients will need professional financial planning advice.”
Meanwhile, the Association of British Insurers wrote to Stephen Timms, chairman of the Work and Pensions Select Committee in October saying, as a matter of urgency, the increase should be paused until a simpler solution could be found.
The ABI said it was not against the age hike but warned of the disruption caused by the use of protected pension ages.
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