Government scraps plans for a secondary annuity market

18th October 2016 - HM Treasury announced today that it will not go forward with plans to introduce a secondary annuity market.

“After an extensive programme of engagement with industry, financial regulators and consumer groups, the government has decided not to take forward plans to introduce a secondary annuities market because the consumer protections required could undermine the market’s development,” HM Treasury said in a statement.

“Over the past few months, following a wide range of discussions, it has become increasingly clear that creating the conditions to allow a vibrant and competitive market to emerge, with multiple buyers and sellers of annuities, could not be balanced with sufficient consumer protections.

Simon Kirby, economic secretary to the Treasury, added: “It has become clear that we cannot guarantee consumers will get good value for money in a market that is likely to be small and limited.

“Pursuing this policy in these circumstances would put consumers at risk – this is something that I am not prepared to do.”

Darius McDermott, managing director of Chelsea Financial Services commented: “I think this is the right thing to do, as it will most likely avoid poor outcomes for the majority of annuity holders.”