On Wednesday 19th March the Chancellor of the Exchequer – George Osborne unveiled the most radical reformation of the UK pension regime, dwarfing the A-day changes announced in 2006

In an effort to provide consumers with more freedom and choice in retirement, the UK Government has announced radical reforms to enable people with defined contribution pensions to access their funds much more freely. Members of these schemes will no longer be forced to buy annuities at retirement and will instead be able to access their pensions in full from age 55 (subject to tax).

While this is great news for the 13 million UK pension savers affected, the UK Government has other plans for defined benefit schemes.

Treasury fears that the benefits delivered by the reforms will provoke a mass exodus of members from public sector final salary schemes wishing to gain access to their pension funds through what is called a cash equivalent transfer value (CETV).

The majority of public sector final salary schemes (including the NHS) are funded by the tax payer and projections indicate that if just 1% of members transferred out the cost to the Exchequer (the taxpayer) would be £200m.

As a result, the government intends to introduce legislation, to take effect in April 2015, banning transfers from all public sector final salary schemes including the NHS, impacting medical professionals such as nurses, doctors, dentists and specialists.

The government is also concerned about the effect that large scale transfers out of private sector defined benefit schemes will have on the wider UK economy as UK pension funds are major investors in other UK assets. Consequently a similar ban on these transfers has also likely.

The transfer bans will of course include transfers to Australia.

So what does this all mean for your NHS pension? It is a serious issue for members looking for a better, more stable retirement outcome than the UK government is willing or able to provide.

Would you like to take early retirement?

Do you want to have access to your pension in amounts and at times under your control?

Do you want to pass on to your spouse 100% of your death benefits?

Are you single and don’t need the benefits offered to a spouse/dependent?

Do you have a long term partner, but are not married, and want that person (or any other relative for that matter) to inherit your pension on your death?

If you are thinking about a pension transfer you will need to act quickly. It takes months to obtain a quote, receive financial advice and arrange for a transfer to an Australian Qualifying Recognised Overseas Pension Scheme (QROPS). Private sector final salary pension holders may possibly have a few more months.

With the UK pension landscape in such a state of flux, it makes sense to review your UK pension arrangements now. Transferring may or may not benefit for you, but you only have a limited window of opportunity to get the facts and make a decision. From April 2015 you will no longer have the option of transferring your pension to Australia - so don't wait until it’s too late.

If you’d like to find out more about these reforms and you UK pension situation call Pension Transfers Direct on 1300 783 789 or visit our website. It’s A GOOD MOVE.

With experts qualified and licensed in both hemispheres to provide cross-border advice, we are the world's largest transferrer of pension funds out of the UK and Australia's most experienced transfer specialist.

Since establishing the transfer industry in Australia in 1997, thousands of UK migrants and returning expats, government institutions and a host of financial planning practices have relied on our expertise to make informed decisions about transferring UK pension funds to Australia.

About the author:
Emigrating to Australia from the UK in 1996, David co-founded Pension Transfers Direct (PTD) in 1997 and has been retained to secure HMRC approval for major Australian Superannuation Trust Deeds and to assist them in understanding their QROPS obligations, latterly advising Trustees on scheme design, administration and technical aspects of UK pension arrangements.

Sitting on ATO and Treasury panels as well as being heavily involved with the UK regulators and administrators, David is Australia’s leading expert on UK pension transfers.