The government "should not rush” increasing the age at which private pensions can be accessed, former Pensions Minister Steve Webb has said.

The comments from LCP partner Webb come after newspaper reports suggested that Chancellor Rishi Sunak could use the upcoming budget to announce a hike from 55 to 57, following lobbying from the Association of British Insurers.

This would be faster than the existing timetable, which had the age at which people can access private pensions set to climb to 57 in 2028, when the state pension age reaches 67.

“Ministers should not rush to accelerate that timetable,” said Webb. “People need time to plan their finances and a sudden change could cause real problems.

"There is very little evidence that people are using the new pension freedoms to recklessly blow their life savings at 55.”

He explained that the bigger concern was “people wanting to access tax-free cash and putting the rest in a low return cash account”, adding that “a more creative approach might be to explore whether individuals should be able to access their tax-free cash at 55 whilst leaving the rest in their pension if they wish to do so”.

Share Story: