What the 2015 Autumn Statement means for your UK pension
On 25 November 2015 the UK Chancellor delivered his Spending Review and Autumn Statement. While the Autumn Statement produced no new major pensions-related announcements, key points to highlight include:
- The biggest real term increase to the basic State Pension in 15 years with the full basic State Pension rising to £119.30 a week, an increase of £3.35. This means that a person could receive £570 more a year in 2016-17 than if it had been uprated by average earnings since the start of the last Parliament.
- The State Pension triple lock has been maintained, which means the benefit rises each year by 2.5 per cent, inflation or average earnings – whichever of the three is highest.
- From April 2016, those reaching pensionable age will receive the new single-tier pension with a starting rate of £155.65. Those reaching pensionable age before the reforms were introduced will receive their State Pension in line with current rules.
- At the Summer Budget the government launched a consultation on potential changes to pension tax relief. The government is currently reviewing responses with a view to publishing a response at Budget 2016.
- At the March 2015 Budget the government announced proposals to enable people to sell their annuity income stream to a third-party in exchange for a lump sum, provided the original annuity provider was in agreement – a so called secondary annuity market. The Autumn Statement confirmed the government will publish a formal response in December 2015 with legislation expected in the Finance Bill 2017.