Abolishing compulsory annuities could lead toscandal

With interest rates so low, pressure on the Government to extend the maximum age for annuity deferment is likely to intensify during 2002

If compulsory annuities were abolished, we could end up with a misselling scandal on a similar scale to that of the 1990s, when representatives and advisers persuaded employees with guaranteed company pensions to transfer to equity-based personal plans. Mike Wadsworth, partner with Watson Wyatt, warns: 'Ending compulsion to buy an annuity at retirement will not remove the financial and arithmetic risk of running down capital in later retirement, leaving people who live longer than average with little or no private income. Many people in retirement will find it difficult to generate an ade...