USP take-up increases on fear of TFC removal

Mike Morrison, pensions strategy director at Winterthur Life, says many people are worried the government might try to get rid of tax-free cash (TFC), particularly if personal accounts are introduced. He says since A-Day, in the second quarter of 2006, there has been a 64% increase in the number of people moving into an unsecured pension (Usp) or drawdown, with many using the flexibility of the new A-Day rules to get their tax-free cash, or pension commencement lump sum (Pcls), but leave the remainder of their fund intact by taking no income. Morrison says there is a growing fear the ...