Treasury to cap 'prohibitive' pension exit penalties

FCA to enforce level of cap

Jenna Towler
clock • 3 min read

The Treasury will legislate to cap excessive early exit charges levied on savers using pension freedom, it has confirmed.

The Financial Conduct Authority (FCA) will be tasked with implementing the policy. Speaking in the House of Commons, Chancellor George Osborne said: "The pension freedoms we've introduced have been widely welcomed, but we know that nearly 700,000 people who are eligible face some sort of early exit charge. "The government isn't prepared to stand by and see people either ripped off or blocked from accessing their own money by excessive charges." He added: "We've listened to the concerns and the newspaper campaigns that have been run and today we're announcing that we will change the...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

HMRC repays £48.5m in overpaid pensions tax in third quarter of 2025

HMRC repays £48.5m in overpaid pensions tax in third quarter of 2025

Analysis finds savers have recouped more than £1.5bn since 2015 introduction of pension freedoms

Martin Richmond
clock 03 November 2025 • 4 min read
Govt ignores pension tax lock call as petition responses top 18,500

Govt ignores pension tax lock call as petition responses top 18,500

AJ Bell started petition; Govt forced to respond after 10,000 signatures

Jenna Brown
clock 23 October 2025 • 2 min read
How SIPPs and SSASs could help power the UK's energy goals

How SIPPs and SSASs could help power the UK's energy goals

'The role of pensions in supporting renewable energy deserves further consideration'

Caitlin Southall
clock 23 October 2025 • 4 min read