Pensions experts are warning of a mass exit from contracted out DB schemes as the DWP consults on plans to abolish transfers to DC alternatives.
Hargreaves Lansdown pensions analyst Laith Khalaf criticised the move, claiming it restricted member choice without delivering any benefits.
He says: "It would also exclude final salary scheme members from taking their pension as and when they want, using the new flexible pension rules arriving next April."
He also warns of a potential "firesale" of final salary liabilities as companies offer members incentives to transfer out "while they still can".
"The Pensions Regulator could be in for a busy time making sure all such transactions are conducted properly and members' interests are not compromised," he adds.
Standard Life senior pensions policy manager Andrew Tully (pictured) agrees, arguing the proposal could create a rush of people switching from DB to alternative savings vehicles, such as personal pensions or SIPPs.
He adds: "I would like the Government to review this aspect of the regulations as I see it as a retrograde step which takes away consumer freedom and choice. That is the line I will be taking in our response to the Government."
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