The Government has set out its plans in today's Queen's Speech for its final year before voters go the ballot box in the 2015 General Election with pensions at the centre of reforms.
The changes to the pensions system announced in March's Budget were among the raft of legislation announced in the Queen's speech this morning at Parliament which included plans for 15 bills or draft bills.
There will be two major pensions bills including one which will enact the pension changes announced by Chancellor George Osborne in March. This will see the obligation on people to buy an annuity with their pension savings lifted and will enable them to draw their retirement income in one go if they choose. It will also pave the way for a more flexible post-retirement pensions landscape.
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The Queen said: "Legislation will be brought forward to give those who have saved discretion over the use of their retirement funds.
"My government's pension reforms will also allow for innovation in the private pensions market to give greater control to employees, extend the Isa and Premium Bond schemes and abolish the savers' 10 pence tax rate."
A new collective defined contributions pension scheme, modelled on a system used in Holland, was also announced in the details released after the speech itself.
The pension would allow workers to be able to pay into funds shared with potentially thousands of other members to reduce costs. Some experts have suggested this could reduce group pension costs by up to 30% and boost pension returns as a result although sceptics have questioned this.
Prime Minister David Cameron said: "The reforms we plan will be the biggest transformation in our pensions system since its inception, and will give people both freedom and security in retirement.
"By no longer forcing people to buy an annuity, we are giving them total control over the money they have put aside over their lifetime and greater financial security in their old age.
"It's all part of our wider mission to put power back in the hands of the people who have worked hard – trusting them to run their own lives.
"At the same time we're completing sweeping reforms to workplace pensions to give employees more certainty about their income in retirement.
"Taken together, this is a revolution that matches our previous reforms to education and welfare in giving people opportunities they were previously denied."
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